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Center for Development Research Department of Political and Cultural Change ZEF Project Working Paper Series 34 Strategic Group Analysis Hans-Dieter Evers and Solvay Gerke Department of Political and Cultural Change ISSN 1864-6638 Bonn 2009 ZEF Working Paper Series, ISSN 1864-6638 Department of Political and Cultural Change Center for Development Research, University of Bonn Editors: H.-D. Evers, Solvay Gerke, Peter Mollinga, Conrad Schetter Authors’ address Prof. Dr. Hans-Dieter Evers Senior Research Fellow Department of Political and Cultural Change, Center for Development Research (ZEFa) Walter Flex Strasse 3, D-53113 Bonn, Germany Prof. Dr. Solvay Gerke Director Department of Political and Cultural Change, Center for Development Research (ZEFa) Walter Flex Strasse 3, D-53113 Bonn, Germany Strategic Group Analysis Contents 1. INTRODUCTION 1 1.1. Social and Political Complexity 1 1.2. The Dilemma of Macro Theories 1 2. STRATEGIC GROUP THEORY 2 2.1. Defining strategic groups. 2 2.2. Social Differentiation and Strategic Group Formation. 2 2.3. Strategic Group Formation 5 2.4. Networks or compliance? 5 2.5. Modes of Appropriation and Sequential Pattern Analysis 6 3. STRATEGIC GROUP ANALYSIS (SGA) 8 3.1. Identification of Strategic Groups through PRA 8 3.2. The power of numbers (democracy or “the more the better” principle) 10 3.3. Conclusions 10 BIBLIOGRAPHY 11 1 1. Introduction 1.1. Social and Political Complexity Societies are complex and difficult to describe. Increasing social differentiation has led to what Habermas has called “die neue Unübersichtlichkeit” (Habermas 1985). This uncertainty poses severe problems for social science analysis. Often fundamentalist beliefs are used to construct explanations and cause for action. As Karl Mannheim has already pointed out, political ideologies offer simplified solutions for complex problems. The excessive use of models in economics and some of the other social sciences may be seen as a desperate act to reduce complexity of a real world that is becoming more and more difficult to understand, to analyze and to describe. Instead of observing and analyzing real world situations, researchers construct virtual worlds, which then become the playing field of scientific debates and conclusions. The great financial crisis of 2008 developed, according to expert opinion, because nobody could any longer understand the extremely complex world of derivates and other financial instruments. The virtual world of finance, often inadequately described as a “bubble”, became even more complex than the real world of goods and commodities before it took revenge on its creators when the bubble burst. 1.2. The Dilemma of Macro Theories Social scientists have attempted to deal with complex processes in various ways since Karl Marx explained history as a process of class struggles and Max Weber postulated that the rise of rational action is the core process in the emergence of modern economy and society. Modernization theory assumes that the modernization of states and societies follows a more or less predetermined path. It assumes that all societies, undergoing a process of modernization, will follow a unilineal development path towards the model of a modern industrial society (usually the USA). Modernization theory provides up to now the guiding principles of most development strategies. Doubts have, however, arisen, following the failure of many development programs, the failure of the US to maintain its position as the world`s only superpower and the current financial crisis of the capitalist world banking system. Modernization theory is based on the probably false assumption that all societies follow the same or a similar path of developing modern institutions, political and economic systems, namely liberal capitalism, American style democratic institutions and a Western type of civil society. It is not able to adequately explain conflicts and crisis in the development of societies. On the other hand class theory is not able to explain short-term social trends in most developing countries. Class Structure and hidden class conflict may be permanent features of all societies, but these are difficult to detect. Open class conflict becomes visible only in certain periods of history, like during the French or Russian revolutions. Class analysis is therefore useful only for very long-term analysis or on rare occasions for open, ongoing class conflict. To explain “ordinary” social processes and conflict situations we need a medium range theory. Strategic group theory is located between modernization theory and class theory. It assists in understanding current social change and medium range developments especially in fast developing countries. It assumes that human actions are governed by an interest in maximizing material and immaterial gains and profits. There are, of cause, other motives for social action, like love and hate, envy and admiration, but these are seen as secondary. In this sense strategic group theory is a theory of rational choice. 22. Strategic Group Theory 2.1. Defining strategic groups. Strategic groups are neither elites nor social classes. They cut across hierarchies, its members do not carry cards or identification tags, and they may follow different lifestyles and follow different beliefs. They are, however, united by one common goal: to secure present and future chances to gain access to resources; to share chances of appropriation of resources and their distribution. They are not necessarily members of a network nor members of an organisation, though this is not excluded either. A strategic group is, in sociological terms, a quasi-group. As all quasi groups it may eventually assume group or network characteristics and move towards becoming a “Stand” (estate) in the sense of Max Weber or becoming a social class in Marxian terms, though we admit on theoretical grounds that it rarely happens. As resources are, by definition, scarce different strategic groups compete for access to these resources. If new resources are created by the action of a strategic group, others nevertheless attempt to get a (perhaps undeserved) share, calculating costs and gains in terms of a cost-benefit analysis. In this sense competition and strife for resources resembles a market model, where the actors are not individuals but social groups and where the overarching strategy is not immediate profit but institutional change. Strategic action aims at creating social, political and economic structures and institutions that enhance the chances to appropriate resources. Individuals or companies may act for immediate gains, strategic groups follow long-term strategies. All the above assumptions may not always tally with “real” measurable facts. Strategic groups may therefore be regarded as ideal types in the Weberian sense. Some of the described features may be more or less visible. They may be hidden behind the smoke screen of everyday tactics, ideologies or unconsciousness. Strategic group structures and action may also be regarded as a model that, as all models, approximates rather than equals reality. In any case strategic group theory is a device to understand social processes by reducing complexity. It is basically a tool of interpretative sociology (verstehende Soziologie) to reveal the “hidden transcript” (James Scott) of social history; or, to be less ambitious, to make sense of complex social situations and actions. It hopes to lead us to conclusions, when decisions are required and reduce uncertainty and despair, when conventional methods fail. 2.2. Social Differentiation and Strategic Group Formation. The formation of classes is a slow historical process. Classes do not emerge over-night though dramatic events like wars or revolutions may speed up the process considerably. Even so, the positions making up a class have to be created and multiplied first. We might look at a simple model to clarify this point. Say we find a clearly developed class structure in a certain society at a certain time. There is an aristocratic upper class consisting of feudal and clerical nobles, monopolizing military power and control over land and dominating a fairly homogeneous peasantry. If we study the same society a few hundred years later, we may again find a strict class structure, but made up of completely different groups. Aristocrats and serfs have more or less disappeared. The upper class is made up of 'bourgeois capitalists', dominating an industrial proletariat. We are now faced by a question a Chinese historian might like to ask when he compares one firmly established dynasty with the next: what precisely happened in between two firmly patterned social and political structures? How did the transition take place? If in our case 'bourgeois capitalists' form the new upper class, when did the first person of this species make his dramatic appearance? And who was the first ‘proletarian’? Putting all this into less fictitious terms: any firmly established social order contains already the seeds of a new social structure in the form of individuals or groups who might under certain conditions at certain times grow and develop into larger units, groups or classes. Class formation can thus be traced back to the individual level. Before a new class emerges there have to be new social positions sharing the same 'life chances', the same relation to the means of production and power and the same values. Here the connexion to what is now commonly called 'modernization' becomes apparent. The formation of new positions is, indeed, 'modernization'. 3This process is usually described by evolutionary theorists as social differentiation (or by classical thinkers as an increasing division of labour). Though no detailed studies on social differentiation in South-East Asia are available we can conclude from some statistical data and historical accounts that the process was fairly slow, until very recently, both in terms of new roles and in terms of persons filling the new positions. This is indirectly supported by the fact that the proportion of the non-agricultural section of the population of South-East Asian societies (with the exception of Singapore and West Malaysia) has remained roughly at a 20 per cent level up to the 1980s in contrast to earlier European developments. Rapid changes occurred only in the 1990s. Then in many cases the appearance of new roles has been quite sudden and those who took up these new positions had to go through a rigorous re-socialization process. The psychological pressure and personal conflict accompanying the creation of new positions can be expressed in religious terms. There is generally in South-East Asia an increased interest in religion, exorcism and magic. Persons who have migrated to the cities to fill the new roles in the middle ranges of governmental and private bureaucracies seem to have lost their village or kinship connexions without having as yet developed an urban or occupational identity. To express their personal conflicts they turn to traditional means, black magic, and to relieve their anxiety they take part in exorcist rites or mystical practices. Spirit medium cults in Singapore, vows to town spirits (at lak muang temples) in Thailand, exorcism in Colombo, kebatinan groups in Java, and keramat veneration in Malaysian and Indonesian towns have attracted many followers in the transition phase. More recently the emergence of Buddhist and Islamic fundamentalism points into a similar direction (Evers 1973). Large-scale organizations like bureaucracies, the colonial school system and armed forces usually provided forceful re-socialization agencies and were as such indispensable for modernization and the creation of modern positions. In other words, the European experience of the gradual differentiation of social positions out of pre-modern society is not repeated in South-East Asia, but differentiation occurs primarily by importing role patterns or by their imposition on society from abroad, usually through the establishment of large-scale organizations. Modernization, social evolution and social differentiation are therefore largely foreign impositions on South-East Asian countries. Bureaucracies are patterned on Euro-American examples and differences are treated as deviations to be abolished, the medical profession subscribes to the ethics and standards of their counterparts in industrialized countries and factories hardly make any allowance for the different social background of their workers and try to achieve the same organizational standards as European or American factories. Modernization in the sense of role differentiation is therefore largely guided from outside and superimposed on the non-agrarian population. As the number of positions for each occupational role increases, social mobility has to be high initially. In fact during the first generation a new position is in existence there is 100 per cent in-flow into the new positions. Mobility for the whole society might not be high, but mobility in the newly emerging sector of the occupational structure has to show a very high rate. In the initial phases of modernization persons in modern positions tend therefore to be highly mobile people with all the characteristics associated with strong mobility. In the beginning the incumbents of new positions had probably very little in common. They might at best be seen as what Dahrendorf has termed 'quasi groups' (Dahrendorf, 1962). A sense of common identity is originally still overridden by an identity with the immediate social surroundings, the ethnic group, the kin group, or the stratum of origin. An awareness of the fact that members of a quasi group are affected in a similar way by the economic, social and political forces in a country is often created by dramatic events. The reduction in the number of civil servants in Thailand in 1924-1927 or the reduction in business opportunities of Indonesian traders after a heavy influx of Chinese immigrants in the 1920s has developed a common identity and some form of internal organization (e.g. the foundation of Sarekat Islam). Quasi groups are thus transformed into “strategic groups”, as they now become of strategic importance as groups for political development, for conflict situations, reform or revolution in their societies. They can also be called “strategic” in another sense, as they develop their own strategies and actively promote their own economic or political goals. They tend to support the activities of leaders, emerging out of their own ranks, or those leaders who are thought to represent their aspirations. The strategic group is thus a recruiting field for political leadership and a political pressure group at the same time. We shall 4later return to an analysis of strategic group formation in South-East Asia, but might mention here that civil servants, the military, teachers, professionals and Chinese businessmen seem to have been the major strategic groups in modern South-East Asia. An important condition for strategic group formation seems to be a sudden increase in the membership of a quasi group. An increase in size (not the absolute size as such) will put pressure on members to seek an appropriate share of wealth and power available in a society. A sudden reduction in the available wealth might have a similar impact. This will eventually always result in a conflict situation with other groups who either are on their way to increasing their share of scarce resources or are defending their old position. The perception of potential conflict is certainly increased if members of strategic groups have what James Scott (1968) has called a 'constant pie orientation'. The endeavour of group members is in this case primarily directed at staking a claim to what is essentially perceived as a constant amount of goods, services, and positions. Enlarging the pie and appropriating the additions is not seen as a viable alternative. If indeed this constant pie orientation is as widespread as Scott (1968) claims, than it might help to explain the lack of social differentiation and the intensification of group conflict. The ensuing conflict between groups may then, however, bring about awareness of a common interest, group cohesion and solidarity through the mechanism analysed in detail by Simmel and later by Lewis Coser in his book on the functions of conflict. This new or increased solidarity of the strategic group will be expressed in a distinct style of life and in the foundation of voluntary organizations. This in turn indicates that not only the person following a modern occupation himself, but his whole family becomes increasingly tied to the fate of his strategic group. Marriage within the strategic group and increasing self-recruitment reduce mobility into the group and strengthen group cohesion. The political framework of group conflict is largely determined by the sequence in which strategic groups evolve. In a modernizing society whose old social and political order is doomed to disappear, new norms for political action have to be established. The first modern strategic group to emerge will have the most decisive influence on the new political culture. Once the rules of the game have been established and a distinct political style adopted, any future changes have to take account of the past structure. In most cases it will require a 'cultural revolution' to change the established political normative system. The book by Barrington Moore provides a good deal of material to back this view though its major theme is somewhat different. Moore concentrated his attention on several „strategic groups“, the landed gentry, the peasantry, the government administration, and the urban bourgeoisie. The rise of any of these to power in a revolution set the stage for the major different political systems in the modern world. His studies of Britain, France, Germany, the U.S., China, Japan, and India, lead him to discern three major routes to the modern world: a revolution from above by a combined gentry and bureaucracy led to fascism, a bourgeois revolution of the urban bourgeoisie to western style democracy, and a peasant revolution to communism. It is not so much the descriptive historical contents of Moore's work but the theoretical aspects that are of interest here. The development of strategic groups, their struggle for dominance, and the identification of their interests and norms with what is to be the modernization process provides an excellent framework for analysing South-East Asian developments. The process of group formation might very well be arrested and create a situation of confusion and long term conflict. An example is provided by Clifford Geertz. In his study on the social history of a Javanese town he describes the formation of strategic groups out of basic occupational groups. He then goes on to analyse how these what he calls 'first-order sociocultural groupings' are transformed, divided, rearranged in a time of revolution, political instability and economic depression into the already mentioned aliran. Strategic group formation meant modernization, the establishment of the aliran system a relapse into traditional patterns, without actually re-establishing an integrated traditional society. 'Both tradition and modernity seemed to be receding at an increasing rate, leaving only the relics of the first and the simulacrum of the second. With every shake of the kaleidoscope the past seemed further back and the future further ahead' (Geertz, 1965: 152). This period of confusion, transformation and change, through which a number of South-East Asian countries have gone or are going, is precisely the period we have alluded to in the beginning. It would be misleading to interpret the nature or essence of any society on the basis of a flashlight photo in the darkness of turmoil and rapid change. If we adopt a long-term perspective there are signs that a new social structure will emerge. This new structure, we propose, will come about through a transformation 5of strategic groups into social classes, and we shall therefore try to present some theoretical propositions on this process of class formation in developing societies. 2.3. Strategic Group Formation A rigid class structure and intensive class conflict are not very common phenomena. Basic patterns of structural conflict in a society can probably best be analysed as group conflicts between established and emerging strategic groups. Even if we can discern a fairly clearly developed class structure, there will nevertheless be remnants of strategic groups or newly emerging ones, both providing internal structure to classes. In many cases strategic groups will dominate the social and political scene for prolonged periods of time until under certain conditions a class structure develops. In any case the dissolution of one class structure or a revolutionary change will always be preceded by the development of strategic groups, which will confuse the strict class pattern until a new class system emerges (if at all). The question then is how are strategic groups transformed into classes? A class structure always presupposes a division into a ruling class and classes of those being ruled. It is of course perfectly possible that a society is dominated by a number of conflicting strategic groups. There seems to be, however, a tendency towards coalition. In fact coalitions and mergers of strategic groups controlling different shares of the societal wealth and power appear to be basic to class formation. Historical examples abound from the somewhat uneasy alliance between feudal nobility and clergy during European Middle Ages to the merger of civil service, big business and military elites analysed by C. Wright Mills for the U.S. The shift of the allegiance of the intellectuals from a ruling class to a subject class (e.g. intellectuals has been described as an important factor in the creation of a revolutionary situation by Crane Brinton. Pooling of resources to maintain the ruling position, exchange of personnel and common membership in organizations are some of the mechanisms of coalition. A further aspect of class formation is the restriction or control of mobility into the new class. This is especially felt after a period of high mobility during the formation of strategic groups. Conflict between classes is inherent in any society structured by class, as well as group conflict is inherent in a society structured by strategic groups. There are, however, various ways to reduce, channel or gloss over class conflict (Dahrendorf, 1959). One way is to transform class conflict into inter-personal competition by allowing social mobility and propagating an ideology of equal opportunity for all. This way is usually not open to South-East Asian societies, because opportunity for mobility is so obviously low and because intense inter-personal conflict is less likely in a society in which ethnic and family loyalties still loom large. An Asian solution is, however, provided in the form of clique and patronage systems. Disbursement of government funds and positions and sometimes sharing of dividends from corruption tend to keep patronage systems going for longer periods of time, though closing of downward patronage channels through closer integration of the upper class, economic crises or the creation of competitive patronage systems can endanger the precarious balance. The main threat to such class systems is those new strategic groups that are difficult to integrate into patronage systems, like students or peasant movements. 2.4. Networks or compliance? What keeps a strategic group together? Nothing but nodding ones head to a certain line of proposals, strategies, actions may be required to support the strategies or collective action of a strategic group. Strategic groups are volatile, but may nevertheless be powerful and long lasting. Common values, ideologies and common interests are powerful binding forces and help to develop real groups out of quasi-groups. Strategic groups typically transcend social boundaries and encompass leaders and followers. They may cross class boundaries and its members may belong to different social strata. Kinship networks could also be a binding force of strategic groups. 6Typical strategic groups may be Government/bureaucracy: government employees Military: members of the armed forces, their families and their suppliers of goods and services Professionals: doctors, nurses, members of the pharmaceutical industry Intellectuals: teachers, lecturers, preachers, students, university administrators, poets, artists and journalists Big business: business men, managers, employees of corporations, workers in big industry and many other quasi groups. Strategic groups support long-term strategies to secure the appropriation of resources by shaping or structuring institutions. It is irrelevant who takes action to secure resources or shape the institutions to secure access to resources, as long as the strategic group as a collective supports the action by selective actors who may be described as interest groups or elites. 2.5. Modes of Appropriation and Sequential Pattern Analysis As we have outlined above, strategic groups tend to emerge whenever new resources become available for appropriation or distribution. This was the particularly the case during the industrial revolution, in the period of decolonization or, more recently, in the course of globalisation. The chances of surplus-extraction and appropriation are partly determined by the world economic system and its local articulation, but also by the political system of the post-colonial state. Not only economic laws and stringencies but also power, possibly coercion, helped to determine the chances to increase the strategic groups' share of surplus or of the GNP. Consequently, there is an interest on part of each strategic group to create a political and economic system that provides for optimal chances for appropriation of surplus. In this connection the sequential pattern of strategic group formation becomes important. Whatever group emerges first, tries to establish a "superstructure" (political and economic system) that is most suited to its interest. With the emergence of a new economic system and a new system of domination (Herrschaftssystem), whichever group emerges first to become large or powerful, has the greatest chance to structure the political system, to establish patterns of legitimacy, of political style, in short, to actively promote a specific framework suited to its interests. Any succeeding group has to contend with the already established framework. It has to operate within it or change it against the resistance of its creators, in many places in the First instance the colonial government and entrenched interests of metropolitan capital. Now there seem to be typical ways in which different strategic groups tend to go about this "Überbau" creation, depending, at least partly, on their typical sources of revenue and their typical mode of appropriating it (Elwert 1973:159). We propose to distinguish between three "modes of appropriation": personal, corporate and collective, each having its typical form of revenue, namely fees or rent, profit and taxes or tribute. If we assume that the ultimate interest lies in the maximization of personal income, a basic contradiction arises out of the contrast between collective or corporate appropriation on the one hand, and its private consumption on the other, that is the transformation of collective or corporate income into personal income. Another contradiction derives from the fact that the creation of a state or a political system and the exercise of political power need organized collective action. Thus, collective action and formation of organizations is necessary even if the ultimate aim is the creation of a framework or political environment to enhance personal incomes or personal chances of appropriation. Strategic groups based on the "personal mode of appropriation" would thus have to create organizations to pursue their interests. These organizations may be professional or job-specific organizations like chambers of commerce or a medical association, but to organize political interest and to be able to take part in the shaping of the political system, a different kind of organization appears to be more appropriate, namely political parties. What I am suggesting here is that strategic groups deriving their revenue through "personal appropriation" tend to favour a political system in which political parties play a major role, i.e. parliamentary democracy. Strategic groups deriving their revenue through "corporate appropriation" are in an ambivalent middle position. They could, of course, maintain and extend their 7ownership and control over the means of production by enlarging their organizations, but otherwise might tend to muster political support through patronage or "resource networks". How far these resource networks are developed into political parties would depend largely on the sequential pattern of strategic group formation to which we will return below. Those strategic groups receiving revenue through a public or "collective mode of appropriation", i.e. the government bureaucracy or the military, would tend to enlarge these organizations as a power-base. Their organizations being the major representatives of state power can manage to shape the political system to benefit their own structures of appropriation provided they are successful in their struggle with other strategic groups over the appropriation of sources of revenue. This, however, depends largely on the current structure and style of the political system as shaped by various strategic groups in the order and sequence of their emergence. We may thus summarize our hypothetic model so far by pointing out that the type of political system depends on the sequential pattern of the emergence of strategic groups struggling for the increase of their revenue through their respective mode of appropriation. Strategic groups deriving their income through personal appropriation (like lawyers or small traders) tend to press for the establishment of a political system in which political parties are predominant. Strategic groups deriving their revenue through corporate appropriation (like industrial entrepreneurs or businessmen) tend to promote "resource networks", alliances or corporate expansion. Strategic groups deriving their revenue from collective appropriation (like civil servants or military officers) are likely to press for an expansion of their respective organizations in terms of members and extension of control. Military governments or systems with one-party dominance appear to be political systems serving their interest best. The appropriation of surplus always contains a major contradiction, namely that between those who wish to appropriate against those from whom surplus is extracted. This contradiction becomes more apparent as soon as one strategic group has established its dominance and shaped the economic and political system to ensure its chances of appropriation or if an effective alliance between strategic groups has been formed which again enhances their chances of appropriation. This enhanced chance of appropriation might also be realized by promoting economic growth and appropriating an increasing share of the surplus without necessarily reducing the absolute income of other strategic groups or the population in general (economic growth with increasing inequality). But even then the appropriation of surplus becomes evidently exploitation. Again we have to point to a basic contradiction. "Political stability" through an alliance between strategic groups, that is class formation, might produce economic growth but also increased chances of enrichment and exploitation, which in turn provoke reactions, movements, uprisings and possibly revolution. Controlling these movements from below and checking the growth of counter strategic groups thus becomes a major aspect of the political system. Ironically organizations originally intended to foster the interests of the immediate producers like peasant organizations or trade unions may be turned into instruments of control and into structures of appropriation. Document Outline
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