Capitalism and democracy, in short, are not two modules, like an engine and a steering system, to be combined or not depending on their technical compatibility. They are both, individually as well as in their respective combination, the outcome of specific configurations of classes and class interests as evolved in a historical process driven, not by intelligent design, but by the distribution of class political capacities. Thus post-war democratic capitalism was not a selection by skillful social engineers or concerned citizens from a range of less optimal alternatives, but a historical compromise between a then uniquely powerful working class and an equally uniquely weakened capitalist class that was as never before on the political and economic defensive – which was true in all capitalist countries at the time, among the winners of the war as well as the losers. [...]

[...] Capitalism and democracy thus seem to simultaneously support and undermine one another: while an economic equilibrium is necessary for a democratic society to reap the collective benefits of private capital accumulation, it is put at risk by the very same policies that are needed to make private capital accumulation socially acceptable; and while a political equilibrium is needed to generate consent also with capitalism, it is threatened by the policies that are required for economic equilibrium. Democratic governments under capitalism, this implies, are faced with a dilemma between two systemic crises, one political, the other economic, where managing one of them is possible only at the price of rekindling the other, forcing politics to move back and forth between them, in the hope that the crisis cycle will allow them enough time to regroup for addressing the inevitably emerging new problem caused by the most recent solution

To study contemporary capitalism, I argue, sociology must go back before the disciplinary division of labour with economics negotiated on its behalf by its twentieth century founding figure, Talcott Parsons. For this it will be helpful to rediscover the sociology in classical economists from Smith to Pareto, Marshall, Keynes and Schumpeter, and the economics in classical sociologists like Weber, Sombart, Mauss and Veblen, to name only a few. Particular interest might usefully be paid to the institutional economics of the Historische Schule and to Marx the social theorist, as opposed to the deterministic economist. The lesson to be learned from all of them is that capitalism denotes both an economy and a society, and that studying it requires a conceptual framework that does not separate the one from the other.

[...] needs are dynamic, and especially in capitalism; that what is ‘necessary’ for life is to a large extent socially defined, i.e., necessary only for social life in a given society; and that outside of the limiting case of complete deprivation, scarcity is neither absolute nor open-ended but socially contingent and constructed. [...]

If human needs are not fixed but fluid and socially and historically contingent, it must follow that scarcity is, to a considerable extent, a matter of collective imagination, and the more so the richer a society ‘objectively’ is. The insight that it is importantly imaginations that drive economic behaviour – imaginations that, other than material necessities, are inherently dynamic – points to a cultural-symbolic dimension of economic life. [...]

[...] dreams, promises and imagined satisfaction are not at all marginal but, on the contrary, central. While standard economics and, in its trail, standard political economy, recognize the importance of confidence and consumer spending for economic growth, they do not do justice to the dynamically evolving nature of the desires that make consumers consume. A permanent underlying concern in advanced capitalist societies is that markets may at some point become saturated, resulting in stagnant or declining spending and, worse still, in diminished effectiveness of monetized work incentives. It is only if consumers, almost all of whom live far above the level of material subsistence, can be convinced to discover new needs, and thereby render themselves ‘psychologically’ poor, that the economy of rich capitalist societies can continue to grow. [...]

[...] More money than ever is today being spent by firms on advertisement and on building and sustaining the popular images and auras on which the success of a product seems to depend in saturated markets. In particular, the new channels of communication made available by the interactive internet seem to be absorbing a growing share of what firms spend on the socialization and cultivation of their customers. A rising share of the goods that make today’s capitalist economies grow would not sell if people dreamed other dreams than they do – which makes understanding, developing and controlling their dreams a fundamental concern of political economy in advanced-capitalist society

Is the state, then, the executive committee of the capitalist class? The answer that does justice to the dialectical, i.e., inherently contradictory nature of capitalism as a social formation is that it is, but only to the extent that it is not. If government was entirely captured by capitalist interests it would be unable to protect them from destroying themselves [...] But while capitalism does depend on being saved from itself by a politics that is at least in part responsive to social counter-movements, capitalists cannot act on such dependence, if only because they are always irresistibly tempted to gamble on making a last killing before the casino will go bankrupt. [...]

[...] The first public for public sociology, I suggest, is the academy, with its unprecedented numbers of students in economics and business administration, who are being taught, in essence, that society exists only as a grandiose opportunity for utility maximization by those capable of making the most rational choices. If we can’t sow the seeds of doubt here, where then? [...]