Here's a must-read passage from Peter Drucker's Post-Capitalist Society. The money quote: “The real, controlling resource and the absolutely decisive ‘factor of production’ is now neither capital nor land nor labor. It is knowledge.” Read on…
Capitalist society was dominated by two social classes: the capitalists, who owned and controlled the means of production, and the workers — Karl Marx’s “proletarians,” alienated, exploited, dependent.
The proletarians first became the “affluent” middle class as a result of the “Productivity Revolution”… Around 1950, the industrial worker — no longer a “proletarian” but still “labor” seemed to dominate politics and society in every developed country. But then, with the onset of the “Management Revolution,” the blue-collar workers in manufacturing industry rapidly began to decline both in numbers and, even more noticeably, in power and status. By the year 2000 there will be no developed country where traditional workers making and moving goods account for more than one sixth or one eighth of the work force.
The capitalist probably reached his peak even earlier — by the turn of the century, and surely no later than World War I. Since then, no one has matched in power and visibility the likes of Morgan Rockefeller, Carnegie, or Ford in the United States; Siemens, Thyssen, Rathenau, Krupp in Germany; Mond, Cunard, Lever, Vickers, Armstrong in Great Britain; de Wendel and Schneider in France; or of the families that owned the great zaibatsu of Japan: Mitsubishi, Mitsui, and Sumitomo. By World War II they had all been replaced by “professional managers” — the first result of the Management Revolution. There are still a great many rich people around, of course, and they are still prominent in newspaper society pages. But they have become “celebrities”; economically, they have almost ceased to matter. Even on the business page all the attention being paid to “hired hands,” that is, to managers. And such talk of money as there is is about the “excessive salaries” and bonuses of these hired hands, who themselves own little or nothing.
Instead of the old-line capitalist, in developed countries pension funds increasingly control the supply and allocation of money. In the United States, these funds in 1992 owned half of the share capital of the country’s large businesses and held almost as much of these companies’ fixed debts. The beneficiary owners of the pension funds are, of course, the country’s employees. If Socialism is defined, as Marx defined it, as ownership of the means of production by the employees, then the United States has become the most “socialist” country around — while still remaining the most “capitalist” one as well. Pension funds are run by a new breed of capitalists: the faceless, anonymous, salaried employees, the pension funds’ investment analysts and portfolio managers.
But equally important: the real, controlling resource and the absolutely decisive “factor of production” is now neither capital nor land nor labor. It is knowledge.