Welcome to a weekly investigation into the fascinating world of corporate sabotage where human creativity, cooperation, mutual aid and well-being are all held ransom for the profit and power of dominant owners.
Every week this column will explore various aspects of what Veblen called ‘strategic sabotage’. But first, a bit of context.
It appears that the English word ‘sabotage’ was at first associated with an emerging working class in the throes of being transformed into docile bodies for capitalists. The origins of the term are a bit fuzzy but it seems like it stems from the French – sabot – meaning wooden shoe or clog. Popular history has it that workers would use their ‘sabots’ to ‘sabotage’ production in order to safeguard their livelihoods from machine replacing labor or win better working conditions from their masters. Eventually ‘sabotage’ could also mean workers deliberately performing poorly at their respective employments or willfully destroying tools or machinery. According to the Oxford English Dictionary (OED) ‘sabotage’ enters the English language in 1910 and can be defined as:
The malicious damaging or destruction of an employer’s property by workmen during a strike or the like; hence gen. any disabling damage deliberately inflicted, esp. that carried out clandestinely in order to disrupt the economic or military resources of an enemy (my emphasis).
Clearly, sabotage was both a working class phenomenon and a tactic used in elite European geopolitics in their Darwinist conceived nationalist ‘war of all against all’. However, sabotage seemed to apply more to the activity of disempowered workers struggling for rights and better working conditions than it did the powerful and ‘productive’ capitalists. It seems a bit strange then, that the term came to be applied to the modern business enterprise by the American born Norwegian political economist Thorstein Veblen. Veblen argued that in its quest for profit, business had to strategically sabotage industry. A free run of production – allowing workers to cooperate to meet the needs and maybe even demands of their communities – would be ruinous for business profit. In Absentee Ownership, Veblen argued that the practice of sabotage had more or less been normalized by modern business ownership:
This line of least resistance and greatest present gain runs in the main by way of a vigilant sabotage on production. So true is this and so impassively binding is this duty of businesslike sabotage, that even in a crisis of unexampled privation, such as these years since the War [World War I], the captains of Big Business have been unable to break away and let the forces of production take their course; and this in spite of their being notably humane persons…(1923: 217).
Put simply, sabotage knows no mercy in pursuit of profit. But the idea that business could sabotage industry was hardly new. Marx understood this back in the nineteenth century:
It is enough to mention the commercial crises that, by their periodical return, put the existence of the entire bourgeois society on its trial, each time more threateningly. In these crises, a great part not only of the existing products, but also of the previously created productive forces, are periodically destroyed. In these crises, there breaks out an epidemic that, in all earlier epochs, would have seemed an absurdity — the epidemic of over-production. Society suddenly finds itself put back into a state of momentary barbarism; it appears as if a famine, a universal war of devastation, had cut off the supply of every means of subsistence; industry and commerce seem to be destroyed. And why? Because there is too much civilization, too much means of subsistence, too much industry, too much commerce (1848: 7).
And Marx was right. In a world where the majority just struggled to meet their daily caloric intake, no one would have complained about the ‘overproduction’ of food or material comforts. But the difference between Marx and Veblen is that where Marx saw acts of sabotage as periodic responses to economic crises, Veblen argued that it was a permanent feature of capitalist controlled industry. Business has to sabotage human creativity for profit. In fact, he argued that sabotage would be difficult for a small firm to carry out and much easier for large corporations to perfect. Some have it that the modern corporation was born to minimize transaction costs. This is a charitable view unconcerned with organized power. Others building on Veblen’s more critical stance have demonstrated that the birth of the corporation was all about subjecting human creativity to the pursuit of power measured in money (Nitzan and Bichler 2009). The corporation is not born to minimize costs, it is born to exert power.
Veblen’s analysis of the political economy of capitalism was a radical divergence from neoclassical economics – a pseudo-science that would steamroll over all independent, critical and creative thought in the twentieth century. As James Cornehls put it:
Veblen’s analysis of the business corporation stood in sharp contrast to the genial, socially productive behaviour of the capitalist envisioned by neoclassical economic theory. Neoclassical economics depicted business people, under the guidance of a benign market, producing as much as they could and striving to lower costs and bring the most cost-effective products to consumers. In Veblen’s system this same group of business people would as soon sabotage production as enhance it, in order to obtain a financial gain (2004: 34).
So from working class origins, sabotage comes to be associated with organized business in Veblen’s political economy. Next week, we’ll take a closer look at how the capital as power approach conceptualizes sabotage with a view to a weekly investigation into corporate sabotage around the world.
Readers are more than welcome to share evidence of sabotage around the world by sending an email to with the subject headline: Sabotage.