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Cinema and the Wealth of Nations: Media, Capital, and the Liberal World System / Edition 1

Cinema and the Wealth of Nations: Media, Capital, and the Liberal World System / Edition 1

by Lee GrievesonLee Grieveson
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Cinema and the Wealth of Nations explores how media, principally in the form of cinema, was used during the interwar years by elite institutions to establish and sustain forms of liberal political economy beneficial to their interests. It examines the media produced by institutions such as states, corporations, and investment banks, as well as the emergence of a corporate media industry and system supported by state policy and integral to the establishment of a new consumer system. Lee Grieveson shows how media was used to encode liberal political and economic power during the period that saw the United States eclipse Britain as the globally hegemonic nation and the related inauguration of new forms of liberal economic globalization. But this is not a distant history. Cinema and the Wealth of Nations examines a foundational conjuncture in the establishment of media forms and a media system instrumental in, and structural to, the emergence and expansion of a world system that has been—and continues to be—brutally violent, unequal, and destructive.

Product Details

ISBN-13: 9780520291690
Publisher: University of California Press
Publication date: 11/24/2017
Edition description: First Edition
Pages: 492
Product dimensions: 6.00(w) x 9.00(h) x 1.20(d)

About the Author

Lee Grieveson is Professor of Media History at University College London. He is the author of Policing Cinema: Movies and Censorship in Early Twentieth Century America and coeditor of a number of volumes, including Inventing Film Studies, Empire and Film, and, most recently, Cinema’s Military Industrial Complex.

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The Silver Screen and the Gold Standard

Cinema and the Wealth of Nations explores how media, principally in the form of cinema, was used by elite institutions, such as states, corporations, and investment banks, to establish and facilitate a form of liberal political economy that began in the nineteenth century and spread globally thereafter. Didactic and persuasive cinema, and the organizations formed to produce and circulate it, is an important part of this story. I also explore how in the 1920s a corporate media industry was established, and then synchronized with finance capital and other large technology and telecommunications companies, as part of a new corporate-dominated consumer economy. I explore these twin developments of persuasive and commercial media as a history, ultimately, of how media was fashioned to supplement forms of territorial and economic imperialism during the interwar years. During this period, the United States eclipsed a British-dominated liberal world system and inaugurated new forms of economic globalization founded on a compact between state and capital. Media played significant roles in that consequential process.

The subject of this history is the enmeshing of media and liberal political economy at the foundation of the modern world of globalized capital, principally from 1913 to 1939, which marked the slow dissolve from one world system to another. But this is not a distant history. Cinema and the Wealth of Nations at its broadest is a genealogy of how media was used to encode liberal political and economic power. I examine a specific and foundational conjuncture — the establishment of media forms and a media system instrumental in, and structural to, the emergence and expansion of a militantly neoliberal world system that has been (and continues to be) brutally violent, unequal, and destructive.

But first the history: various powerful organizations began to use cinema in the early twentieth century to shape the attitudes and conduct of people, as well as new political and economic practices. Vast numbers of films were produced by the governments of the United States and Britain; by some of the largest corporations of the modern age, such as Ford Motor Company, US Steel, General Electric (GE), and General Motors; and by associated industrial and lobbying groups like the US Chamber of Commerce, the National Association of Manufacturers, and, in Britain, the Federation of British Industries. Powerful agencies engaged in struggles over modes of production, material resources, and axes of exploitation made and circulated media. Frequently the films were collaborations between state and corporate institutions.

Broadly speaking, these films explicated and extolled the advantages of the new technologies, economic practices, and infrastructural and circulatory networks of the second-stage industrial revolution and the ascendant corporate and monopoly stage of capitalism. How to live and consume in the new eras of mass production and consumption were common subjects. Propaganda institutions were also established by states that both produced and monitored media, and these expanded and "exceptional" governmental practices continued thereafter. New forms of distribution and mobile exhibition created alternative networks for the circulation and display of this persuasive media, placing it in extant civil and industrial spaces, such as schools, universities, prisons, and factories. Novel technologies, including mobile cinema vans, circulated media across remote areas in the US interior or across the sprawling British Empire. Over time these intertwined state and corporate practices produced new and innovative film forms, including in 1920s Britain what came to be called "documentary," which was established to help sustain the political economy of liberal empire. Etched still in the photosensitive, halogen silver salts of celluloid, albeit now at times rerendered as digital data, is a record of the modern world of advanced liberal capitalism as it began to coalesce through the actions of the same powerful state and economic institutions that made and circulated the films.

I argue throughout this book that these films, technologies, networks, and media forms were intentionally integrated to shape the conduct of populations and ultimately to facilitate and supplement the establishment of new forms of liberal political economy across the world. Frequently this media was disseminated through newly created educational networks and used to educate and socialize particular populations in new "productive" practices and identities. The films, and the institutions that produced and circulated them, were part of an expansive liberal praxis, driven by political and economic elites to establish new forms of subjective, economic, and political order fit for the new modality of mass production, consumption, and corporate and monopoly capital. Cameras caught the escalation and proliferation of the second stage of the industrial age: the mechanization of agriculture alongside the expansion of extractive mining of mineral and energy resources and the integration of the rural and imperial periphery into a new urban and industrial order; the emergence and growth of the corporation and new forms of "corporate liberalism," which underscored the expansion of global trade; the construction of new infrastructural networks to facilitate economic circulation (from railways to canals and from roads to communicative networks like the telephone and radio); and new procedures of factory mass production (along with efforts to socialize migrant and subaltern workers in new practices of wage labor). With these was the corresponding growth of a consumer economy, enabled by mass production and new distribution networks, that was integral to the broader "corporate reconstruction" of the economy that took place around the turn of the century.

Very little attention has been paid to the history, institutions, and forms of this elite pedagogic media. But I gamble here on the premise that it is worth looking closely at the films, institutions, and practices established by powerful elite organizations for what they reveal, both about the formation of the political and economic rationalities and practices that created our modern world and specifically about the ways media was used and shaped to elaborate that world.

Also critical to my analysis is an account of the commercial media system that emerged in this period as a significant supplement to new forms of consumer capitalism. The history of radio is extremely significant in this regard: formed from complex geopolitical struggles to control communication infrastructure between the residing (British) and emergent (US) world powers, developed through government mandate by large technology and telecommunications corporations in the United States (principally GE and American Telegraph and Telephone Company [AT&T]), and enshrined in US government policy in the 1927 Radio Act to be a medium financed by advertising and not, say, by state or educational actors. I explore this history in chapter 9, "League of Corporations," drawing on the work of significant media historians. Here it is enough to simply observe that policy also frames the usefulness of media for a political and economic system that became tied to the expansion of a consumer economy from this precise point onward.

In 1919, the same year the US government, GE, and AT&T (principally) created the Radio Corporation of America (RCA) as a complex hybrid of government and corporate interests — the largest film studio, in what was starting to be called Hollywood, allied with an influential investment bank to attract pools of capital. Paramount, as the studio came to be called, did so specifically to buy property in the form of cinemas and cinema chains, so as to "vertically integrate" by joining together separate aspects of the production, distribution, and exhibition of film into one corporate entity. It became the first media corporation to exercise significant control over all aspects of production, wholesaling, and retail, part of the broader corporate reconstruction of American capitalism that had begun with the railroads in the 1860s and had gathered pace in the 1890s. Bankers played a significant role in that process, using the capital generated from investment — in Karl Marx's classic formula, M-C-M'— to merge industrial firms into large corporations and controlled monopolistic or oligopolistic markets. GE was formed in 1892 from a merger of separate electrical firms, brokered and financed by the investment banker J.P. Morgan, who had considerable financial interests in Edison GE. By the early 1920s, cinema as exemplar of an emergent cultural industry peddling newly mechanized forms of transient pleasure in expensive real estate evidently began to seem like a productive site for the investment of finance capital. The "silver screen," said one of the investment bank reports written about cinema in the 1920s, could produce a "golden harvest."

The corporate reconstruction of cinema in alliance with capital was consistent with the broader tendencies and logics of those developments as they accelerated from the latter parts of the nineteenth century. It catalyzed with the emergence of a consumer economy that gathered pace in particular in the 1920s, after the development of the corporation and mass production, that was ever-more predicated on spectacle, display, and, indeed, on the transformation of the commodity from a material object under a regime of use value to its dematerialization in relationships of exchange. New forms of value creation in the elicitation of desire and affect were produced in this process, exemplified by cinema and the expansion of new practices of advertising and "public relations." One of the most significant functions of corporate cinema/media may indeed have been to expand the images and associated values of a corporate-produced commodity culture, first across the "core" economies from which it emerged and quickly thereafter to "peripheral" regions across the world system.

Both radio and cinema in its corporate phase were tied together with finance capital and integrated directly and expansively with the new practices of consumption integral to the dawning era of corporate capitalism. The studios, formed into corporate entities with pools of finance capital, began to control many of the most profitable theaters/properties in urban centers and the circulatory networks of distribution that were integral to the realization of rental value from the dematerialized commodity that was film. The corporate reconstruction of cinema and a broader media system produced by large vertically integrated entities with close ties to banks, and as an adjunct to the generation of capital, significantly shaped the forms and functions of that cinema/media thereafter. I shall lay some of my gambling cards on the table here: I take it as self-evident that the corporate and capital control over media, subsumed under the imperative to generate capital, marked a radical diminution of the possibilities of media culture. This, in turn, produced a media system that is patently antithetical to the communicative requirements of a democratic society. The emergence of media forms that required extensive capitalization, and which were controlled by corporate and financial entities, catalyzed with the corporate reconstruction of capitalism and liberalism to radically limit the public sphere. I explore the history of the corporate (re)construction of media here not as an abstract, "academic" exercise but because that history has been integral to the orchestration of power in the modern world, as well as to the relentless expansion of commodity culture and a capitalist market economy across the global system.

Ties between film corporations and investment banks deepened across the 1920s. From around 1925, additional pools of finance capital flooded into the film industry, much of which was used to facilitate the "transition to sound," which resulted in significant alliances between some of the same large technology and telecommunications corporations involved in radio (and other sonic technologies like the telephone and phonograph) and film studios. The "talkies" were born "convergent," driven by the related goals of banks and corporations with interests in technology, patents and media, and established from the same year — 1927 — that the Radio Act was passed. It makes sense to view these developments together rather than separately, as is usually done (one example of the doleful consequences of the balkanization of the study of media). The synchronization of media, capital, technology, and telecommunications in this period marked something like a "big bang" for the formation of enduring "convergent" tendencies across these sectors, as well as for the further shaping of media as a commodity synced to the generation of capital. GE, to continue with that organization, both as exemplar and as an entity that is extremely important in and of itself, maintained significant control over RCA and created NBC, the radio network, in 1926 and RKO, the vertically integrated film studio, in 1928. GE and other technology and telecommunications corporations considered media to be significant profit generators across various sectors that included technology and intellectual property, as well as box-office.

The corporate reconstruction of media in the United States was enabled and facilitated by state action. Broad developments such as the redefinition of the corporation itself from public entity to private property in the late nineteenth century, which accorded corporations the kinds of constitutional protections afforded individuals, were significant here, as was the related protection of expansive property rights. Further developments helped the media produced by corporate entities to circulate globally. In the early 1920s, the US Department of Commerce proposed that "trade follows the motion pictures," effectively suggesting that film was a form of advertisement for the objects and lifestyles pictured within it, which thus could generate wealth for the nation. After this, the US State Department began reporting on conditions affecting the circulation of moving pictures abroad in its Daily Consular and Trade Reports, putting the information-gathering capacities of its foreign and consular offices to work circulating both the pedagogic films produced by corporate and governmental institutions and commercial films produced by corporate media entities. Quickly thereafter, the lobbying and trade group formed by the corporate film studios to advance their economic interests began pressing for the establishment of a motion picture section within the Bureau of Foreign and Domestic Commerce. The corporate studios had cannily hired a well-connected former Republican Party national chairman called Will Hays to run its lobbying and public relations organization — an early example of the "revolving door" between political and economic elites that helps entrench policy decisions beneficial to capital.

In 1926, Congress responded positively to the request and appropriated resources to help films produced by corporate film studios circulate across the globe as what the influential commerce secretary (and later president) Herbert Hoover described as "a powerful influence on behalf of American goods." Will Hays told students of the Harvard Business School the following year, "I could spend all of my allotted time telling you how the motion picture is selling goods abroad for every manufacturer ... 'Trade follows the film.'" (In his memoirs, he described the "foreign department" of the mainstream industry's lobbying and public relations arm as "almost an adjunct of our State Department.") What began to emerge was a theory and practice of media's importance and usefulness for economic globalization that was carried through governmental institutions. These were created from partnerships between corporate media entities and the state that were mediated by a lobbying group managed by a well-remunerated member of the political elite. This was corporate liberalism in action. Movies began to operate as the avant-garde for the spread of US commodity culture and capital across the world system at the dawn of the century that would famously be labeled American.


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Table of Contents

List of Illustrations

1. The Silver Screen and the Gold Standard
2. The Panama Caper
3. Empire of Liberty
4. Liberty Bonds
5. The State of Extension
6. The Work of Film in the Age of Fordist Mechanization
7. The Pan-American Road to Happiness and Friendship
8. Highways of Empire
9. League of Corporations
10. The Silver Chains of Mimesis
11. The Golden Harvest of the Silver Screen
12. Welfare Media
13. The World of Tomorrow—Today!

Sources and Bibliography

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