- The following is an excerpt from his new book, "Transaction Man: The Rise and Decline of the American Dream," an account of how the concentration of great wealth has coincided with the fraying of social ties and the rise of inequality in the US.
- According to Lemann, a Transaction Man (who may be a woman) often works on Wall Street or in Silicon Valley in a job that is literally transactional in fields such as private equity, venture capital, or hedge funds and is fundamentally skeptical butlikes to do things quickly and forcefully.
- The Transaction Man is the opposite of his predecessor, the Organization Man, who dutifully followed orders at the serene, secure big corporation that was his lifetime employer.
- "The institutions responsible for maintaining democracy and ensuring a good life for ordinary people are badly outmatched," he writes. "All over the world, through their political and cultural behavior, people are showing how they feel about that."
- This article is part of Business Insider's ongoing series on Better Capitalism .
- Visit Business Insider's homepage for more stories.
Who won in this contest of visions the side that valued a structured, organization-based society or the side that saw it as profoundly unhealthy? The anti Organization Man view won, without question, if the field of battle was a term [John Kenneth] Galbraith made popular, "the conventional wisdom." Its victory was so thorough, and so consequential, that today the representative figure of our age is an almost completely opposite character, whom we can call Transaction Man. Transaction Man (who may be a woman, of course) often works in a job that is literally transactional, in such fields as trading financial instruments, private equity, venture capital, and hedge funds parts of American culture and the American economy that writers like [William H.] Whyte didn't even bother to mention, because they seemed so inconsequential at the time. The Organization Man dutifully followed orders at the serene, secure big corporation that was his lifetime employer. Transaction Man is often in the business of breaking corporations apart and rearranging them in ways that have made it just about impossible for anybody these days to be an Organization Man. The idea of a corporation, or any other institution, providing generous guaranteed benefits and career-long job security is at odds with the way Transaction Man thinks the world should work. It's too static, too traditional, too constraining of creativity.
William Whyte noted that the Organization Man could be found applying his set of attitudes all over America, not just in the corporations and suburbs that were his primary home, and the same is true of Transaction Man. What really matters about Transaction Man is the way he thinks, not specifically what he does. Professionally, Transaction Man can perform any function that involves arriving in the middle of a complicated situation and, at least in his own mind, finding a solution that has eluded the participants: strategic consulting, global philanthropy, education reform. He is confident, not cautious; change-embracing, not change-resisting. Transaction Man thinks of himself as an idealist, someone whose work will benefit humanity. He'll alleviate poverty, help conquer disease, give opportunity to the underprivileged, make markets function better. Although he does well for himself, he doesn't see any self-interest in what he's doing only an improving instinct.
Transaction Man is fundamentally skeptical about institutions and organizations, especially long-existing ones. He believes they are stodgy, bureaucratic, stuck in the past, and too beholden to traditions and arrangements that have built up over time. He'd use terms like "innovation," "disruption," and "breaking down silos" to describe healthy social processes, and "incumbents" or "rent-seekers" or "special interests" to describe those who are standing in the way of them. He believes there is a rational, efficient solution to every big problem, and that it can usually be achieved by bypassing or even eliminating existing structures and replacing them with something more fluid and unconstrained. Anything that throws sand in the gears, that delays what looks like progress, that involves negotiation and compromise, that gets in the way of the obvious solution labor unions, local governments, legal constraints, interest groups that make particular claims is problematic. Transaction Man is suspicious of politics and of provincial concerns; his perspective is global and based on what he regards as universal principles. He likes to do things quickly and forcefully. The idea that bargaining among groups is the way to achieve the best solution strikes him as fundamentally wrongheaded, not to mention boring.
If you were to go looking for a specific place to find Transaction Man, it would certainly not be Park Forest, Illinois. Wall Street and Silicon Valley, which have become far more powerful and wealthy over the last generation or two, would be more like it. These are new, or newly altered, locations that exemplify the rising spirit of the time, just as Park Forest did for its time but now the spirit is about speed, not stodginess; individual expression, not conformity; undoing restrictions, not adhering to them. Like the spirit of the previous age, ours has its characteristic flaws.
The transactional society has become one where wealth and power are increasingly concentrated, and where public life, rather than being contained inside a narrow band of acceptable thought, is much more fraught with anger and contention. That is because, paradoxically, our suspicion of institutions has brought us a new set of institutions (because institutions are an inescapable part of human life, and the real question is what form they will take) that are fewer, but larger and more dominant, than the set of institutions that preceded them. The most important ones are clustered in a few areas, such as finance and technology, and in a few places geographically, mainly the East and West Coasts. The ecosystem is out of balance: The institutions responsible for maintaining democracy and ensuring a good life for ordinary people are badly outmatched. All over the world, through their political and cultural behavior, people are showing how they feel about that.
Social changes of this magnitude are too large to have occurred just because of a shift in the atmosphere. They have a history in which events generated ideas, ideas generated actions, and actions changed the structure of society. This book aims to lay out the history of our move from an institution-oriented to a transaction-oriented society. This is not a matter of one set of values succeeding another for no particular reason. It's a more specific story, which begins with Americans of the early twentieth century confronting the powerful new reality of concentrated economic power and debating how to constrain it. This was an intense, all-consuming, highly consequential battle, fought not just here but worldwide.
Out of these intense dissatisfactions and disagreements and conflicts, the institution-based order, with a much bigger national government and the corporation at its anchors, emerged. Then another set of dissatisfactions and disagreements, this time directed against government and corporations, produced another set of big changes, which, in turn, created the new transaction-based order.
And today, a third vision, of a society based on Internet-enabled networks which might restore some of what the age of transactions destroyed is emerging. A handful of companies based on this vision have become the largest in the world, and networks have created instant ways for people to connect. We are only just beginning to see this vision's large effects on how work, economic life, and politics are organized and on how power is distributed. After laying out institutions, transactions, and networks as successive master organizing principles for society, this book finally will suggest another way entirely of thinking about our future, one that would give more honor to people like Nick D'Andrea and Ann Neal, who live at a great distance from the country's centers of power.
Nicholas Lemann, born in New Orleans in 1954, began his journalistic career there and then worked atWashington Monthly,Washington Post, andTexas Monthly, of which he was executive editor. A frequent contributor to national magazines, he was national correspondent ofThe Atlantic Monthlyand is now a staff writer atThe New Yorker. His books include the prizewinning "The Promised Land: The Great Black Migration and How It Changed America"(1991).
Excerpted from TRANSACTION MAN: The Rise of the Deal and the Decline of the American Dream by Nicholas Lemann. Published by Farrar, Straus and Giroux September 10th 2019. Copyright 2019 by Nicholas Lemann. All rights reserved.
- A productivity expert on the 5 mistakes you're probably making in meetings without realizing it
- I went from being a nanny and cocktail server to a multimillionaire at 33. Here are my 3 tricks for getting ahead.
- My work schedule completely burned me out and nearly ruined my marriage. Heres how you can run a successful company and not be miserable doing it.