CAPITALISM, DEMOCRACY AND D ISCRIM IN A TIO N

The rise and decline of racism in Cox’s Caste, Class and Race

Ganeshwar Chand1

Source: The Review o f B lack Political Economy 22(2) (1994): 71-92.

In his book Caste, Class and Race, Oliver Cromwell Cox took positions on the link between capitalism and racism that appear contradictory; on the one hand he argues that racial exploita­tion emerged with the rise o f capitalism, and on the other, that advancement o f capitalism would reduce racial exploitation.This article analyzes this seeming contradiction from a M arxian perspective and argues that Cox failed to seriously consider the central organizing mechanism of capitalism—competition—to discuss the relation between capitalism and racism. To analyze race relations under any mode of production, the central organ­izing mechanism o f that mode has to occupy a focal position. A failure to take account o f that fact often results in political con­clusions that, like Cox’s, are divorced from theoretical analysis and thus are weak and impractical.

Introduction

Since its appearance in 1948, Oliver Cromwell Cox’s book, Caste, Class and R ace2 has received mixed reactions from radical writers. Some radical scholars have labeled the book a “superb work of Marxist scholarship”3 while others have challenged the attribution of a Marxian status to it.4 Some regard the work to be in the neo-Marxian tradition5 while others regard Cox as a “critical theorist” getting inspiration from a number of critical thinkers, including Marx.6 As there are differences in views on what is Marxian and what is not, so are there differences in the methods of evaluat­ing radical writings. Already, varying perspectives have been utilized by radical writers to evaluate Cox’s seminal work. Miles, for example, has criticized the book on the ground that by not locating race relations in the context of

social formations of the societies under discussion, the work remains un- Marxist. Gabriel and Ben-Tovin argue that by attributing a “conspiratorial” explanation for the production and reproduction of racist ideology amongst the working class, the work becomes reductionist.7 Morgan argues that Cox failed to distinguish between free and unfree labor; thus he (Cox) failed to locate racism as an ideological legitimation for exploitation carried out under unfree conditions.8 These lines of analysis are academically stimula­ting, but what they fail to do is to test Cox’s work against Marxist economic theory. Furthermore, they remain too abstract for meaningful political conclusions.

During the 1970s and 1980s neo-Marxian writers began analyzing the race question seriously. Some made the issue of political change central to their writings. Michael Reich’s celebrated work, for example, argued that both black and white workers suffered while the capitalist class gained from racial discrimination.9 Similar arguments are found in many other radical works.10 The obvious political conclusion emerging from such an argument is that black and white workers would both benefit from a united working class move­ment. Such an analysis of racial phenomena dominated radical academic work on racial discrimination during the 1970s and early 1980s.

But this orthodoxy has not remained unchallenged. In her studies of the South African and American working classes, Bonacich proposed that the working class could actually be split where instead of forging working class unity, each segment competes with the other for material gains.11 Years earlier, Baran and Sweezy also had argued that white workers “benefit by being protected from Negro competition for the more desirable and higher- paying jobs.”12 That workers could consciously act to preserve and/or further their gains at the expense of workers of a different race has been argued recently by Williams who utilized the notion of competition to arrive at this conclusion.13 The same notion has been utilized to support what appears to be an opposite position—that racism declines with a decline in competition. Cherry interprets Marx’s view that with the bankruptcy of technologically inferior producers competition and superexploitation of the disadvantaged declines, to imply that “the elimination of competition was the principal reason for the decline in discrimination.”14 The implication is that as capital­ism moves away from a competitive stage towards a monopoly stage, i.e., as it matures, discrimination declines. But yet again, there is a differing opinion on this issue. Baran and Sweezy argue: “as monopoly capitalism develops, the demand for unskilled and semi-skilled labour declines both relatively and absolutely, a trend which affects Negroes more than any other group and accentuates their economic and social inferiority.”15

Given the obviously contradictory positions, the crucial question that arises is whether or not development (or maturity) of capitalism and advancement of democracy reduce discrimination, or at least, increase cross-racial class consciousness and solidarity.

It was precisely this issue that decades earlier Cox was grappling with in Caste, Class and Race. But unable to ultimately decide on it, he took positions that seem contradictory. On the one hand, he argued that racial exploitation and prejudice emerged with the rise of capitalism and nationalism,16 and on the other that advancement of capitalism and democracy reduces racial pre­judice and exploitation.17

This article analyzes, from a Marxian perspective, this seeming contradic­tion and the implication that it had for Cox’s political conclusion.

Cox on the rise of racism

Cox’s argument on the rise of racism in Caste, Class and Race is straight­forward.18 “[RJacial exploitation and race prejudice developed among Euro­peans with the rise of capitalism and nationalism.” Though there have been centuries of contact between peoples of different races, racial exploitation is a phenomenon specific to capitalism. During precapitalist contact between different races, the concept organizing these interactions was not race, but culture. The Hellenic Greeks, for example, had a cultural rather than a racial, standard of belonging; the division of the greater empire was between Greeks and barbarians. Barbarians were all those who did not possess Greek cul­ture, especially language. The barbarians, however, were welcomed and encouraged to adopt Greek culture (learn, participate, intermarry, etc.), thus become a Greek and thereby a superior being. Similarly, in the Roman Empire System, which was the next great organization around the Mediterranean Sea, Cox argues that there was an absence of racial antagonism. Here again, the norm of superiority was a cultural one; the basic distinguishing criterion was Roman citizenship. Even the slaves were not discriminated against; some slaves, especially the Greek ones, were actually the teachers of their masters. Thus, slavery was not a racial stigma; educated freedmen could rise to high positions in government and industry.

The rise of Christianity provided a powerful ideology to preclude racial prejudice/exploitation. In Europe, the policies of the Roman Catholic Church presented a bar to the development of racial antagonism. Christianity, es­pecially Roman Catholicism, had a folk and personal, not a territorial and racial, norm of belonging. The division of the greater society was between Christians and non-Christians. By conversion, which was actively promoted, a person of a different “race” could become a part of the dominant/Christian community.

Similarly, in the Middle Ages, the Asiatics, Huns, Saraces, Moors, Seljuk Turks, Ottomans, Tartars, etc., all went deep into Europe and subjugated and sometimes enslaved the white people, but such actions were marked by an absence of racial antagonism among the invaders. The most powerful invaders, the Moslems, for example, were prohibited by their religion to display race prejudice; the criterion of belonging in Islam was a cultural one, not racial.

Even the gradually increasing commercial journeys of the Europeans pre­cluded racial antagonism as long as religious controls remained effective. Thus the Portuguese drive in Africa didn’t indicate racial prejudice. As long as the Portuguese and the Spaniards continued to accept the religious defini­tion of human equality, the development of racial prejudice was limited. In fact the church also received its share of African servants and slaves but there was no basis for racial exploitation; the church had not yet developed rationalizations for inborn human inferiority.

It was only with the dawn of modern European civilization that racism began cropping up as an ideology. With the discovery of America,

the mysticism of the East soon lost its grip on human thought, and the bourgeois world got under way. The socioeconomic matrix of racial an­tagonism involved the commercialization of human labor in the West Indies, the East Indies, and in America, the intense competition among businessmen of different western European cities for the capitalist exploita­tion of the resources of this area, the development of nationalism and the consolidation of European nations, and the decline of the influence of the Roman Catholic Church with its mystical inhibitions to the free exploi­tation of economic resources. Racial antagonism attained full maturity during the latter half of the nineteenth century, when the sun no longer set on British soil and the great nationalistic powers of Europe began to justify their economic designs upon weaker European peoples with subtle theories of racial superiority and masterhood.19

Cox picks the exact years “which marked the beginning of modem race relations” as 1493-94.20 This was a time when Spain and Portugal, the first two great European colonizing nations, had officially assumed a “total dis­regard for the human rights and physical power of the non-Christian peoples of the world, the colored people.”21 Pope Alexander Vi’s demarcation issued under Spanish pressure on May 3, 1493, and its revision by the Treaty o f Tordesillas on June 7, 1494 arrived at through diplomatic negotiations be­tween Spain and Portugal, put all the “heathen” peoples and their resources at the disposal of Spain and Portugal. The Roman Catholic Church, how­ever, provided a major barrier to the exploitation of these resources. In par­ticular, the church constantly inhibited the incubation of the capitalist spirit during the early sixteenth century among the Spaniards and Portuguese. The profit-making motive was constrained by the philosophy and purpose of the Roman Catholic Church. What was lacking was a social theory supporting capitalist drive for impersonal exploitation of the workers.

Thus, the vital problem for the capitalists was to circumvent the assimila­tive effects of conversion to Christianity. As long as the church stood for the equality of human beings, that is, of the Christians, maximum exploitation of the colored workers, which would consign these workers to employment

and treatment that were humanly degrading, could not be carried out. In order, therefore, “to justify this treatment the exploiters must argue that the workers are innately degraded and degenerate, consequently they naturally merit this condition.”22 Such an ideological justification was finally provided in 1550 by the Spaniard Gaines de Sepulveda who began arguing that it was lawful to make war against and enslave the Indians because of the gravity of their sins, the rudeness of their heathen and barbarous nature (which obliged them to serve those of more elevated natures), and for the spread of the faith (which would be made easier by their subjugation). “Sepulveda, then,” argues Cox, “may be thought of as among the first great racists.”23 Following this, there were numerous publications and sermons on the natural incapacity/ inferiority of the coloreds, and thus, arguments against assimilation, for assimilation destroyed the basis of exploitation.

This armed the capitalists with an ideological tool—a social theory—to oppress the colored and exploit them. It was this that changed the nature of slavery. Now, slavery became a way of recruiting labor for the purpose of exploiting the great natural resources of America. But had white workers been available in sufficient numbers, they would have been used instead. Indeed, in “some of the early experiments with labor in the West Indies both white and black workers were used in the field and their treatment and value were ordinarily determined by their relative economic pro­ductivity.”24 Slavery, therefore, was not an abstract, natural, immemorial feeling of mutual antipathy between groups, but rather a practical exploi­tative relationship.

Race and culture

The above analysis of racial exploitation rests solely on a physical differen­tiation of people. Where people differentiate themselves by culture, “racial” exploitation does not arise. This argument is essentially definitional. For, according to Cox, race has to do with physical distinction. When people “recognize each other physically and use their physical distinction as a basis for the rationale of their interrelationship, their process of adjustment is usually termed race relations or race problems.”25 Cox distinguishes this from the “nationality” or “minority” problem, which arises when people, who may not have any physical distinction, distinguish themselves from others culturally. In this, the degree of “cultural advancement” (simple or complex culture), language, religion, and nationality feature prominently. Both these senses of belonging—physical and cultural—comprise an “ethnic system,” which incorporates both a race relations problem and a nationality problem.26

Thus, Cox’s hypothesis—that racial exploitation and prejudice emerged with capitalism and nationalism—necessitated him to ignore racial exploitation and prejudice in the pre-capitalist era. This he did by arguing that a cultural

sense of belonging did not cause racial exploitation and prejudice. It would, of course, not, because by definition racial exploitation has to do with physi­cal distinction and not cultural distinction.27

One obvious question that arises here is whether a racial and a cultural sense of belonging are mutually exclusive. Miles argues, quite correctly, that they are not; that “many justifications for racial exploitation have attributed significance to cultural and physical factors simultaneously.”28 Even the evidence that Cox relies on to point to the rise of racism has its very basis in cultural factors. All four justifications that Sepulveda provided for why it was lawful to enslave the Indians rested on cultural grounds. The gravity of the Indians’ sins, the rudeness of their nature, the need to protect weaker Indians from being ritually sacrificed or eaten by stronger members, and the need to spread Christian faith among them are all cultural justifications. Physical justifications—on the basis of cranial size and its impact on measures like attainment levels, IQ’s, etc.—emerged later in the capitalist trajectory.

Cultural and physical distinguishability, then, are inseparably intertwined. Indeed, arguments for superiority on the basis of distinction based on color, size or physical features is untenable and theoretically undeterministic. What is theoretically deterministic in this context is a cultural distinction.

Culture is a much wider phenomenon than mere language, religion or nation­ality. Culture embodies the entire mechanism of societal organization. Social (or class) hierarchies, political organizations, role allocations, belief systems, production and distribution relations, accessibility to means of production, etc.—in other words, the entire set of the social relations of production— is incorporated in the term “culture.”

Thus, when the whites came in contact with nonwhites, the emergent clash was as much, if not more, a clash between people from two different modes of production as it was a clash of people of different skin colors. Because the dynamics of the different modes of production are contradictory to each other, the contradictions necessarily formed a firm basis for initial clash and violence. This, of course, could not have been a visible phenomenon. What was most visible was the physical features of the two peoples. Different people distinguished themselves from others on the basis of what was most visible. And this visibility emerged from ties of common blood, custom and language. Each people distinguishing itself on the basis of ties of common blood, custom and language would view its own culture as superior to that of the other until overwhelmed by the material and physical superiority of the latter. This has remained the basis of the subordination of the primitive communal mode of production by the emerging capitalist mode, and thereby the basis for the subordination of the people under the primitive communal mode by the people from the capitalist mode. The whites’ belief that they had a superior culture, and particularly that they were closer to the God than the blacks, became the justification for the massive doses of violence dished out by the whites to the slaves. In fact it became a firm basis for the ideology of

racial superiority. And Christianity long played a critical role in propagating the ideology of the superiority of white culture.

The development of capitalism and advancement of democracy, however, began to pave the way for improvements in the conditions of slavery. But the emerging capitalism and democracy were not the slaves’ creation; rather they were the creation of the whites. Slavery ended not so much due to the slave revolts as to the white revolts against slavery. For, capitalism did not need slave labor; if available in sufficient quantities, it could survive on free labor. Indeed, early plantation capital of the new world experimented with (white) free labor, but the problem was one of adequate supply of such workers.29 If slaves could be converted into a ready supply of free laborers, it was a possibility worth serious consideration. The advancement in capitalism towards its purer form, therefore, saw the decline in the intensity and degree of racial antagonism and exploitation. But would this trend continue until racism ended?

Capitalism, democracy and race relations

According to Cox, racial exploitation is merely one aspect of the problem of proletarianization regardless of the color of labor. The white proletariat of early capitalism had to endure burdens of exploitation quite similar to those borne by many colored people during the early twentieth century. Thus, under capitalism race relations “are labor-capital-profits relationships; therefore, race relations are proletarian bourgeois relations and hence political-class relations.”30 The problem of racial exploitation, then, will “most probably be settled as part of the world proletarian struggle, for democracy; every advance of the masses will be an actual or potential advance for the colored people.”31

The argument is that where there is greater democracy, the incidence and intensity of racial exploitation is lower. Cox argues that this explained the relatively lower prejudice and discrimination against the Negroes in the Northern United States vis-ä-vis those in the South at the time he was writing. In the highly industrialized North,

the proletariat is further advanced than it is in the South. In fact, we may think of advanced capitalism as a state in which the proletariat has attained some considerable degree of power. In other words, the further the progress of capitalism, the greater the relative power of the proletariat.

In the North democracy, the proletarian system of government, is much more developed than in the South, where the white and the black prolet­ariat has been consistently suppressed. The first great aim of the pro­letariat in all countries has been the capture of the ballot. In the North the workers now have the ballot, but in the South it is still limited among whites and virtually denied to Negroes. It must be obvious that if the common people, regardless of color, were as free to vote in Mississippi as

they are, say, in Illinois, Mississippi could never be the hotbed of racial antagonism that it is.32

The point here is not employment or pay discrimination resulting from the marketplace; it is unequal citizenship. As long as legislation provided for political discrimination against the blacks, the blacks had to reach the political decision-making apparatus for eliminating such discrimination. And for this, political franchise was a necessity. Thus Cox writes: “In its struggle for democracy, the first great aim of the proletariat everywhere has been the extension of the suffrage.”33 With the franchise, the race suffering discrimina­tion could influence legislation. Franchise could lead to equal citizenship, and thus, the elimination of legal discrimination.

The notion of democracy that applies here is one of bourgeois democracy. A system of bourgeois democratic rights is a definite advance from an ab­sence of a right to vote. With gradual political advancement it, then, is certain that discriminatory legislation could be gradually eliminated. Thus overt racism is likely to decline.

But the elimination of political discrimination, i.e., the attainment of equal citizenship, does not lead to an end of all forms of discrimination. While legal discrimination is one aspect of racism, market-induced discrimination is another. Even when legal discrimination is absent, market-induced discrim­ination could, indeed does, continue.34 This involves discrimination in em­ployment, promotions, training, pay, and other job-related conditions for the workers, and credit, raw material, technology and market accessibility for the capitalists. Cox ignored a serious consideration of this.

In this respect, Cox’s fundamental argument is that with the advancement of capitalism, workers of various races will see common cause in uniting against capital. This will tend to eliminate discrimination against workers of certain races.

Industrialization creates the need for an exploitable labor force, but it is in this very need that the power of the proletariat finally resides. The fa c to r y organ iza tion n o t on ly p ro v id e s the b asis f o r the w o rk er organ iza tion b u t a lso fa c i li ta te s the deve lopm en t o f a consciousness o f c lass p o w e r an d ind ispensability . Social equality . .. has been an explicit objective of the whole proletariat, regardless of color or country, almost from the dawn of industrial capitalism. Therefore, as the stronger white proletariat advanced toward this end in the North, Negroes have advanced also. In the South the white proletariat is weak and Negroes.. . weaker still. To the extent that democracy is achieved, to that extent also the power of the ruling class to exploit through race prejudice is limited.35

The crucial argument, therefore, is that with the increasing advancement of capitalism, not only would the need for political democracy rise, but very

critically, contact between the workers of different races at the factory floor level would rise. This contact would lead to an increasing realization of the common class interests of the workers. Thus, with advancing capitalism, one would expect greater working class solidarity which could be utilized to attain real gains for the entire working class irrespective of the race of the workers. A lower incidence and intensity of racism would, therefore, follow.

The argument proposed here is an argument typically emanating from Marx’s view that the industrial working class would be the propeller of the proletarian revolution. In the face of capitalist exploitation, there would be a strong tendency for industrial workers to unite and work towards socializing the work place. This is what Cox calls “accomplished democracy.”36

There is no doubt that as an outcome of the generalization of capitalism, a greater class sentiment and a lower racial sentiment is a strong tendency. But there are two very strong counter-tendencies within the capitalist mode of production which emanate from the phenomenon which organizes capital­ism: competition.

Competition is a cutthroat process whereby participants aim not only at gaining an upper hand in the battle, but also at preserving the gains. The process is basically antagonistic, violent destructive and turbulent. It was such a process that Akio Morita, the Chairperson of the Sony Corp, was referring to when he stated “business is war.” Competitive wars are ever occurring phenomena between different capital owners, different industries, capital and labor, labor and labor, producers and consumers, capitalist and noncapitalist sectors, and even between nations. Unlike the neoclassical notion of (perfect) competition which “describes a market in which there is a complete absence of direct competition among economic agents” and which as a concept “is the diametrical opposite of the entrepreneur’s concept of competition,”37 the Marxian notion of competition describes a process where rivalry is very much personal to the participants.38 Thus the Marxian concept of competition, rehabilitated by writers like Clifton, Shaikh, Weeks, Semmler, Darity and Williams, Williams, and Mason,39 is totally different from its neoclassical counterpart.

The first tendency that concerns us here is the competitive behavior that emerges at the commodity exchange/circulation level. This is the competitive struggle between merchant capital and workers/consumers. As long as one race dominates the distribution sector, competitive struggle between pro­ducers and consumers would lead to a racial interpretation of the behaviors of the different participants. The distribution sphere is a very visible sphere. Participants interact with each other at a very personal level. A consumer/ worker going to a store to purchase a commodity meets the store owner most directly. In the store the worker’s meager income and various needs confront the shelves full of commodities. The evident translation of this confrontation is into the people representing the different objective positions. This transla­tion takes an especially rapid pace where the people are of different races.

In the United States, the blacks were long confined to the working class and the distribution outlets were controlled predominantly by the whites. A significant part of race relations in modem America, therefore, has been shaped within such a framework. The competitive struggle between the black workers/consumers and the white distributors tended to be translated into racial prejudice. Thus, discussing discrimination of the 1960s, Harris argues that the small white businessmen (petty capitalists) operating in the black ghetto had to be tough and mean in the application of capitalist game rules if they were to survive the competition from large distributors. “The victims of their toughness and meanness [were] black workers and consumers. Since some of the capitalists themselves [were] white their behavior always [took] on the outward appearance of ‘white racism’.”40

With the advancement of democracy, the possibility of the black population entering the distribution sphere rose. But white distributors viewed the entry of the blacks into this sphere as a threat to their profitability and exclusivity. Attempts by the white distributors to preserve the sector for themselves and the attempts by the blacks to enter this sphere became the cause for a competitive war in which capitalists from each race used race as a battle tool.

The insignificance of the blacks as capitalists in the industrial sector has been, at least in part, a result of the attempts by existing capital to prevent new capital from entering various industries. That existing capital was white and new capital included black capitalists, gave a concrete form to antiblack racism. The consequence of this was that black capital had to be confined to those industries/ventures which catered predominantly to a black clientele, or, what is often called the “secondary sector.”

Wilson points out that the “emerging Negro businessmen and professional class turned inward and espoused the philosophy of self-help and racial solidarity”41 as that articulated by Booker T. Washington. The “Buy Black” campaign of the 1920s and 1930s, initiated by black businessmen was speci­fically aimed at black consumers.42 The aim of this, together with an appeal to black nationalism, was to create a cohesive and self-sufficient black metro­polis, but this attempt failed because most black businesses could not survive; they were undercapitalized and could not obtain credit from white banks.43

The 1968 Nixon proclamation that the United States must create black capitalism by getting “private enterprise into the ghetto” and “the people of the ghetto into private enterprise—as workers, as managers, as owners”44 also failed. Nixon had proposed provision of additional finances (through a small business loan scheme, reinsurance programs, building relations between white and black lending institutions, the creation of a Domestic Development Bank, etc.), the creation of a New Enterprise program that was to provide training in business skills, upgrading black human capital, etc., to encourage black capitalism.45

But writers like Baron46 and Franklin and Resnik47 argue that the idea of black capitalism has a long history; interestingly, however, the history is one

of failure, not success. Franklin and Resnik’s explanation for the failure is that black capitalism never went beyond the marginal service and retail stores that operated in unstable segregated markets, were run by people with no commercial and financial experience, and where blacks regarded businesses as a supplementary income source.48

My contention is that these explanations do not reach the core of the problem. Blacks’ attempts to enter the mainstream of the capitalist business sector have been met by strong opposition and antagonism from existing capital. Added to this is the problem of credit unavailability from large banks which in many cases have ongoing relations with existing businesses to which credit to black capitalists would provide competition. Discrimination in obtaining raw materials and other supplies, and obtaining markets is another cause.49 Perlo argues that “intense racism” characterized the mortgage bank­ing and real estate industries.50 Similarly, Swinton and Handy explain the low participation rate of blacks as owners in terms of a lack of external financing available to black owners and restricted demand for products supplied by black-owned businesses.51 The restricted demand for commodities produced by blacks leads to a largely black-only clientele.52 The latter is a result of competition between consumers and sellers with white consumers preferring the larger, and often cheaper, white stores, and the blacks having the option of the cheaper white stores as well.

The natural result of such competitive struggle was the marginalization of a majority of black capitalists to the ghetto and the “secondary sector.”

Racism, therefore, was not eliminated by the progress of capitalism and democracy; rather it changed its form from overt racism legislated by the state to market-induced racism. The Civil War eliminated any legal color bar but numerous discriminatory practices continued, such as city inspectors refusing to approve work of black plumbers and electricians, and, in general, state or local government collaborating with exclusive white craft unions to frustrate black advancement.53 Thus, while the granting of equal citizenship rights ended legalized discrimination, equal citizenship could not do much to stop market-induced discrimination.

The same result is obtained from the labor market. While the shared experiences of black and white workers at the factory floor level tended to give them common cause against capital, the competitive struggle within the working class for employment, better tasks, promotions, training, etc., pitched workers against each other. With race being a very visible element, combined with pre-established color prejudice, race became a battle tool in the com­petitive war between black and white workers.

The bid to get jobs, especially in an economic environment of less than full employment, created conditions escalating racism. Fredrickson argues that in the antebellum and in cases even postbellum South, blacks had little chance of getting industrial employment. In the North, they were effectively excluded from virtually all the opportunities provided by the beginning of

industrialization. Such exclusion was on the ground that the white working class needed the jobs first. Factory work was considered honorable and thus the particular preserve of the whites. After the war, a significant proportion of the white population was without property ownership; thus it needed to subsist by selling its labor power. The factory owners recognized that factory employment was the only avenue left for poor whites. They thus deliberately favored whites over blacks.54

Blacks had great difficulty gaining industrial jobs. The first major influx of blacks into the urban industrial market coincided with a period of white labor unionization and unrest. Between 1875 and 1914, the entry of blacks into northern steel mills was “chiefly in the capacity of strike-breakers.”55 This pattern continued to the New Deal. Because of white union policies, in many cases scabbing was the only way by which blacks could enter industrial employment.56

The entry of blacks into industrial employment during 1900-1930 “sharply exacerbated not only the economic and social anxieties of the white working class but also their racial antagonism,” replacing the utilization of blacks by the management for strikebreaking (scab labor) and substituting the class conflict between white labor and management with racial conflict between white workers and blacks.57

Black influx into the industrial areas also involved competition for urban space, eventually resulting in ghettoization and other associated problems,58 thus adding another dimension to black-white race relations.

The New Deal legislation (for example the National Industrial Recovery Act of 1933, the National Labor Relations Act of 1935 and the Fair Labor Standards Act of 1938) attempted to eliminate wage discrimination, but with capitalists able to bypass the laws or finding loopholes, the ideals were never realized.59 In the short run, however, these laws increased white-black worker solidarity. But internal and external plant relocation and automation due to the rising wage rate affected black workers disproportionately (for reasons which included black concentration in unskilled and secondary sectors). The result of this was the creation of “a class of hardcore unemployed in the ghettos,” becoming full blown in the mid 1950s when black-white unem­ployment ratio became 2:l.60

Capitalism, declining rate of profit, and discrimination

Within industries, apart from attempts at exclusion of competitors, a major battle tool in the competitive struggle is reduction of costs of production. A tendency of competition within industries is towards equalization of prices. Given this, profit margins get inversely related to the costs of production. In their ever-rising quest to reduce the cost of production, capitalists constantly introduce improving techniques of production by increasing the organic

composition of capital. This in turn gives rise to the tendency for the rate of profit to fall.

As profitability declines, the eventual outcome would be a crisis. The decline in general economic activity is accompanied by a decline in employ­ment levels. Consequently, the reserve army of labor is replenished. Within the working class, an intense battle for protecting employment and prevent­ing wage reduction would be fought by the workers. Race (and gender) occupy central roles in this battle. A strong tendency, therefore, would be a rising intensity of racial antagonism within the working class. The cycles of booms and busts create corresponding weak and strong cycles of racial antagonism as well.

While reasonable data is unavailable for the early part of this century, there is, between 1947 and 1985, a very clear declining trend in the rate of profit in the United States.61 So far, however, no empirical study has been done on the implication of this for racial earnings and employment patterns. But what is clear is that the ratio of mean earnings of blacks to that of whites in the United States is higher in prosperity than in recession.62

Historically, during upswings, black participation in skilled and semi­skilled jobs, as well as incomes relative to white incomes, increased. In 1910, for example, only 7.9 percent of the black labor force was engaged in skilled and semi-skilled work. The proportion rose to 12.6 percent in 1930; the war­time shortages plus the postwar boom boosted the figure to 23.8 percent by 1950.63 The 1950s and 60s boom continued, improving the relative posi­tion of the blacks. In 1950, 16.4 percent of black males were employed in middle-class occupations; by 1960 the figure reached 24 percent and by 1970, 35.3 percent, while those in lower-class jobs fell from 62.1 percent in 1950 to 50.7 percent in 1960 and to 36.4 percent in 1970.64 With reces­sion beginning to grip the economy, the movement from low paying jobs to high paying jobs for blacks slowed considerably. In 1969, black median family income was 61 percent of that of whites; by 1978, it dropped to 59 percent.65

In Caste, Class and Race, Cox did not pay any attention to these cyclical trends in racial discrimination. This failure was a direct consequence of ignoring a consideration o f the basic mechanism and operation of capitalism as a system of production and distribution. The capitalist system is organized around competition. Cox failed to consider the impact on race relations of the competitive battle within the working class, between the workers and capitalists, and within the capitalist class.

Thus Cox explains the relatively lower racial prejudice of the whites against the blacks in the Northern United States vis-ä-vis the Southern United States, at least until the early part of this century, in terms of the progress of democracy. The question that arises here is whether it was the progress of democracy or advancement of capitalism which explained lower racial

prejudice in the North. At least Orlando Patterson seems to lean towards the latter variable. Discussing the antislavery tunes of the North, Patterson suggests that it was the fear of competition from the slave-based Southern aristocrats rather than any wish for democratic principles to be extended to the black that made the Northerners anti-slavery:

For the middle-class northerners what was of central concern was not the dehumanization of blacks under slavery but the fear o f . . . slave power spreading to the west and ultimately to the north. The threat which the north saw in the slave power was the centralization of wealth in the hands of a conspiratorial southern elite which had already taken over the national government and seemed on the verge of taking over the national economy. . . Should the southern elite grab the west, it would be the north’s turn next. Not only did the middle-class leadership of the Republicans believe this, they were able to skillfully play upon the fears of the northern working class in persuading them to this view. For the working class the west held out the same hope as it did for the ambi­tious southern working people—a land of boundless opportunity, a way of finally achieving the prized independence that was the essence of America.66

Baran and Sweezy also argue that the Civil War was not fought by the Northern ruling class to free the slaves. Their explanation of the relation between the North and the South, however, seems to be somewhat different than that given by Patterson. They argue that the Civil War was fought

to check the ambitions of the Southern slave-owning oligarchy which wanted to escape from what was essentially a colonial relation to Northern capital. The abolition of slavery was a byproduct of the struggle, not its purpose, and Northern capitalism had no intention, despite the interlude of Reconstruction, of liberating the Negro in any meaningful sense. Having subdued the Southern planters, it was glad to have them resume their role of exploiters of black labor whom it could in turn exploit. The notorious compromise of the 1870s was a tacit recognition that the renewed colonial status of the South had been accepted by both sides, with the Southern oligarchy exploiting the Negro and in turn paying tribute to Northern capital for the privilege of doing so.67

What emerges from both these views is that the struggle was basically an outcome of competition between different types of capital as well as between two different regions for economic and political hegemony.

Indeed, the post-Civil War period may not even have seen a drastically reduced incidence of racial discrimination in the job market in the Northern United States. Bonacich points out that in the North, while wage differentials

for the same work may not have been all that common, differentials appeared in disguised forms, like racial segregation by job titles and segregation by firms.68

It is, then, suggested here that the post-Civil War race relations between whites and blacks in the Northern and Southern United States should be located in competition for material gains—for both the working class and the elite.

Competition and change

Ultimately, Cox’s failure in Caste, Class and Race to incorporate competition in his framework for the analysis of racism under capitalism kept this work wanting in terms of Marxian comprehensiveness. Competition is the basic organizing mechanism under capitalism. If discrimination under capitalism is to be adequately understood, an analysis of competition must occupy a central place in discussing race relations. Darity and Williams argue that the phenomenon of competition explains Cox’s analysis of racial and ethnic division of the labor force in a class-based society.69 Explain it does, but Cox himself had not utilized this phenomenon to analyze race relations.

This was a major theoretical lapse in Caste, Class and Race, a lapse which greatly muddled Cox’s line of argument. It forced Cox to alternate between the argument that capitalism created racism and advancing capitalism re­duced racism. The uncertainty eventually led Cox to divorce his political conclusions from his theorization. But before we move on to Cox’s political arguments, let us return to the seeming contradiction in Cox’s argument. For arguing that capitalism created racism and advancing capitalism reduced racism does indicate a contradiction.

A very strong argument could be made that both positions are tenable within a social system. Indeed, it is very often the case that one system produces two contradictory results. But theoretical endeavor requires that these contradictions be resolved. One outcome, for example, may be more powerful or dominant than the other. Or the outcomes may be fed by different dynamics. It is true that Cox was talking of two different periods in the capitalist trajectory: an early period when capitalism was just emerging in the New World, and a late period when capitalism was in maturity. At different stages, the functional status of slavery was different—in the former, capitalism grew on the basis of the slave system while in the latter, the needs of the capitalist system (though not the needs of individual capitalists) de­stroyed the slave system. Eric Williams demonstrates this dialectic clearly in his analysis of capitalism and slavery.70

But the point stressed here is not that mature capitalism did not need slave labor; rather it is, unlike Cox’s argument, that advancing capitalism did not eliminate racial exploitation. As argued earlier, advancing capitalism tended to eliminate unequal citizenship, but in doing so it, in direct correspondence,

increased racial exploitation, which was enforced and perpetuated by the market mechanism. Cox could not locate this latter phenomenon in his scheme because he did not examine the impact of competition on racial relations. This failure was responsible for the estrangement of Cox’s political conclusions from his theorization.

Cox’s significant political argument was that revolutionary change can­not be initiated by the blacks because black democratic leaders would not get white support.71 But if advancing capitalism leads to cross-racial worker solidarity, as Cox’s theorization implies, why could the black leaders not get white support? On the other hand, if capitalism created racism, then why should cross-racial solidarity arise in the first place? Cox was unable to resolve these contradictions.

It should also be kept in mind that while an analysis of competitive behavior can explain race relations under capitalism, it cannot do so in societies which are not already capitalist. For pre-capitalist societies, the organizing mech­anism of the specific pre-capitalist mode will provide the initial theoretical basis for the analysis. While Cox did isolate one feature of pre-capitalism— that of the importance of a sense of belonging—he did not carry the analysis to its logical end, which would have revealed the existence of racial/ethnic antagonism even between different pre-capitalist peoples. For if different people organized themselves around different senses of belonging—like color, custom, kinship, religion, etc.—then their interaction with each other would see conflict in proportion to differences in the contents of these factors. Cox instead, by mere definitions, eliminated the possibility of racism and ethnic antagonism under pre-capitalist systems.

Conclusion

There is no doubt that Cox’s 1948 book, Caste, Class and Race, had a significant impact on the study of race and class. Indeed, the book was a breakthrough in many respects.72 In the era in which it was written and with the purpose with which it was written, the book had a lasting impact on radical thinkers. The plea for working class solidarity came out most strongly from the book.

But an analysis of competitive behavior within the working class shows that working class solidarity is not the only tendency of capitalism. While progress in capitalism and democracy, by encouraging equal citizenship, does tend to eliminate overt and legalized racial discrimination, it gives rise to another form of racism: market-induced discrimination. The latter can actu­ally be a more persistent phenomenon because there is no visible and overtly discriminatory statute or convention which a society could rally against.

The competitive nature of capitalism is a major factor perpetuating racism. As experiences from countries like America, Britain and Germany adequately illustrate, discrimination does not end with mature capitalism. As capitalism

progresses, its basic driving force—competition—creates strong and weak cycles of racial discrimination corresponding, respectively, with economic downturns and upswings. Marxian logic indicates, quite contrary to Cox’s assertions, that as a system capitalism neither creates racial antagonism nor ends it. What it does, however, is to give a particular form to race relations.

But whether racism declines with the rise of socialism is another question. Cox argued that since capitalism created racism, only a socialist revolution could end racism. This issue has not been investigated in this article. The recent developments in Eastern Europe, especially the ethnic wars going on among the former Soviet states and within Yugoslavia, could provide a useful starting point and direction in analyzing this contention.

In passing, it should be mentioned that whether the defects in the argu­ments made in Caste, Class and Race have been corrected in Cox’s subsequent works also needs to be investigated if a comprehensive understanding of the theoretical contribution of Oliver Cox, one of America’s most significant African American scholars, is to be achieved.

Notes1 I acknowledge the useful comments provided on earlier drafts of this paper by

R honda Williams, Robert N orton, Sara Abraham , and two anonymous referees of this journal. The usual disclaimers apply.

2 Oliver C. Cox, Caste, Class, & Race: A Study in Social Dynamics (New York: M onthly Review Press, 1959).

3 S. Castles and G. Kosack, “The Function o f Labour Immigration in Western European Capitalism,” New Left Review 73 (1972): 16. See also G. D. M organ, “In Memoriam: Oliver C. Cox 1901-1974,” M onthly Review (May 1976): 34-40.

4 Robert Miles, “Class, Race and Ethnicity: A Critique of Cox’s Theory,” Ethnic and Racial Studies 3 (April 1980): 169-187.

5 S. B. Greenberg, Race and S tate in Capitalist Development: A Comparative Per­spective (New Haven: Yale University Press, 1980), p. 131.

6 H. M. H unter and S. Y. Abraham (eds.), Race, Class, and the World System: The Sociology o f Oliver C. Cox (New York: M onthly Review Press, 1987), p. xliv.

7 John Gabriel and Gideon Ben-Tovin, “Marxism and the Concept o f Racism,” Economy and Society, 7, 2 (1978): 118-154.

8 Glenn M organ, “Class Theory and the Structural Location o f Black W orkers,” The Insurgent Sociologist X (Winter 1981): 27.

9 Michael Reich, Racial Inequality: A Political-Economic Analysis (New Jersey: Princeton University Press, 1981).

10 D. M. G ordon (ed.), Problems in Political Economy: An Urban Perspective (Lexington, Mass.: D. C. Heath and Company, 1977), p. 148; V. Perlo, Economics o f Racism U.S.A.— R oots o f Black Inequality (New York: International Publishers, 1975), pp. 128, 150-178; M. Silver, “Employer Taste for Discrimination, Wages and Profits,” Review o f Social Economy, 26, 2 (1968): 185; Castles and Kosack, ibid., p. 17; and R. Cherry, Discrimination: Its Economic Impact on Blacks, Women, and Jews (Lexington, Mass.: Lexington Books, 1989), pp. 60, 222.

11 Edna Bonacich, “Advanced Capitalism and Black/White Race Relations in the United States: A Split Labor M arket Interpretation,” American Sociological Review4 1 (February 1976): 34-51, and E. Bonacich, “A Theory of Ethnic Antagonism: The

Split Labor M arket,” American Sociological Review 37 (October 1972): 547-559. See also S. Shulman, “Racial Equality and White Employment: An Interpretation and Test o f the Bargaining Power Hypothesis,” Review o f Black Political Economy (Winter 1990): 5-20, and Patrick Mason, “The Divide-and-Conquer and Employer/ Employee Models of Discrimination: Neoclassical Competition as a Familial Defect,” Review o f Black Political Economy (Spring 1992): 73-89 for other recent empirical and theoretical critiques of Reich’s divide-and-rule basis o f racial relations.

12 Paul A. Baran and Paul M. Sweezy, Monopoly Capitalism (Suffolk, UK: Pelican Books, 1966), p. 258.

13 Rhonda M. Williams, “Capital, Competition, and Discrimination: A Reconsid­eration of Racial Earnings Inequality,” Review o f Radical Political Economics 19,2 (1987): 1—15.

14 Cherry, p. 53.15 Baran and Sweezy, p. 257.16 Cox, p. 322.17 Cox, pp. 569-70.18 See Cox, pp. 322-45.19 Cox, p. 330.20 Cox, p. 331.21 Cox, pp. 331-32.22 Cox, p. 334.23 Cox, p. 335. See also Jan Carew, “Columbus and the Origins o f Racism in the

Americas: Part One,” Race and Class XXIX (Spring 1988): 1-19 for a similar argument.

24 Cox, p. 338. See also Eric Williams, Capitalism and Slavery (London: Andre Deutsch, 1964) pp. 3-20.

25 Cox, p. 317.26 Cox, ibid.27 The long section on Caste in India in Caste, Class and Race may at first reading

indicate that Cox was dealing with racial exploitation in pre-capitalist systems. But this is far from the case. Cox very clearly states that physical differences did not determine people’s position in the caste hierarchy (Cox, p. 13). Cox identifies race with physical distinction. Thus, the section on Caste in India should not be taken as a discussion o f racial exploitation under pre-capitalism.

28 Miles, p. 181.29 See Eric Williams, Capitalism and Slavery, pp. 3 -20 for a discussion o f the extent o f

and the difficulties in the use o f free labor in the new world plantations.30 Cox, p. 336.31 Cox, p. 583.32 Cox, pp. 569-70.33 Cox, p. 226.34 Compare what Baran and Sweezy (1966) had to say on this issue: “legal equality

does not guarantee real equality,” p. 267.35 Cox, pp. 569-70, emphasis mine.36 Cox, p. 227.37 J. P. Gould and C. E. Ferguson, Microeconomic Theory (Homewood, Illinois:

Richard D. Irwin, Inc., 1980), p. 212.38 Anwar Shaikh, “M arxian Competition vs. Perfect Competition: Further Com­

ments on the So-Called Choice of Technique,” Cambridge Journal o f Economics4 (December 1980): 75-83.

39 J. A. Clifton, “Competition and the Evolution o f the Capitalist M ode of Pro­duction,” Cambridge Journal o f Economics 1 (June 1977): 137-51; Shaikh, ibid.;

John Weeks, Capital and Exploitation (Princeton: Princeton University Press, 1981); Willie Semmler, “Competition, M onopoly, and Differentials o f Profit Rates: Theoretical Considerations and Empirical Evidence,” Review o f Radical Political Economics 13 (Winter 1982): 39-52; William A. Darity, Jr. and R. M. Williams, “Peddlers Forever?: Culture, Competition and Discrimination,” American Econ­omic Review 75 (May 1985): 256-261; R. M. Williams, (1987), ibid.; Rhonda M. Williams, “Competition, Discrimination and Differential Wage Rates: On the Continued Relevance of M arxian Theory to the Analysis o f Earnings and Em­ployment Inequality,” mimeo (University o f M aryland, College Park, 1990); and Patrick M ason, “The Divide-and-Conquer and Employer/Employee Models of Discrimination: Neoclassical Competition as a Familial Defect,” Review o f Black Political Economy (Spring 1992): 73-78.

40 Donald J. Harris, “The Black Ghetto as Colony: A Theoretical Critique and Alternative Form ulation,” Review o f Black Political Economy 2, 4 (1972): 16.

41 William J. Wilson, The Declining Significance o f Race (Chicago: University of Chicago Press, 1980), p. 125.

42 E. Ofari, The M yth o f Black Capitalism (New Y ork and London: M odern Reader, 1970), p. 21.

43 Wilson, p. 125.44 Richard M. Nixon, “Bridges to Human Dignity,” an address by Richard

M. Nixon on the CBS Radio Network (25 April 1968), transcript, U.S. Inform a­tion Agency Library, Washington, D.C., p. 9.

45 Richard M. Nixon, “Bridges to Human Dignity: II,” an address by Richard M. Nixon on the NBC Radio Network (2 M ay 1968), transcript, U.S. Information Agency Library, W ashington, D.C.

46 H. M. Baron, “Racial Dom ination in Advanced Capitalism: A Theory of N ation­alism and Divisions in the Labor M arket,” in R. C. Edwards, Michael Reich and David M. G ordon (eds.), Labor M arket Segmentation (Lexington, Mass.: D. C. Heath and Company, 1975), p. 190.

47 R. S. Franklin and S. Resnik, The Political Economy o f R A C IS M (US: Holt, Rinehart and W inston, Inc., 1973).

48 Ibid., p. 186.49 See Perlo, “Economics of Racism,” pp. 188-89 for a similar argument.50 Perlo, ibid., pp. 184-85.51 As cited in Cherry (1989), p. 194.52 Wallach, as cited in Cherry (1989), p. 195.53 George M. Fredrickson, White Supremacy: A Comparative Study in American and

South African H istory (New York: OUP, 1981), p. 235.54 Fredrickson, ibid., ch. 5.55 Wilson, p. 71-72.56 Bonacich, (1976), pp. 42-43 and Fredrickson, p. 226.57 Wilson, p. 73. Wilson also argues that competition within the labor market

determined race relations only during the late nineteenth century and the first few decades of the twentieth century and that it has ceased to be a major determinant of conduct since. This is an incorrect way of viewing competition, for competition has remained the driving force behind capitalism all along.

58 Fredrickson, p. 227.59 Bonacich (1976), p. 45.60 Bonacich (1976), pp. 47-49.61 Anwar Shaikh, “The Falling Rate of Profit and the Economic Crisis in the U.S.,”

in Robert Cherry, et al. (eds.), The Imperiled Economy, Book I: Macroeconomics from a L eft Perspective (New York: The Union for Radical Political Economics,

1987), pp. 115-126. See also Fred Moseley, The Falling Rate o f Profit in the Postwar United States Economy (New York: St. M artin’s Press, 1991).

62 See Perlo, ibid., pp. 56-57, and Kenneth J. Arrow, “Models o f Job Discrimina­tion,” in Anthony H. Pascal (ed.), Racial Discrimination in Economic Life (Lexington: D. C. Heath, 1972), p. 84. :

63 Fredrickson, p. 237. !64 Wilson, p. 129.65 Wilson, p. 158.66 Orlando Patterson, “The Unholy Trinity: Freedom, Slavery, and the American

Constitution,” Social Research 54 (Autumn 1987): 552-53. I67 Baran and Sweezy, p. 247.68 Bonacich (1976), pp. 36-37. f69 Darity and Williams (1985), p. 260. s70 Eric Williams, “Capitalism and Slavery.”71 Cox, p. 571.72 Robert Miles “Class, Race and Ethnicity: A Critique o f Cox’s Theory,” Ethnic and

Racial Studies 3 (April 1980): 183.