In a short note, Horkheimer writes that “the basic form of domination is the racket.”Max Horkheimer, “Die Rackets und der Geist” in *Max Horkheimer gesammelte Schriften*, Bd. 12, 287. During the early 20th century, the terms “racket” and “racketeering” were primarily associated with Chicago criminal gangs that arose during the early 20th century as a reaction to poverty amongst recent immigrants from Europe and the prohibition of alcohol. These gangs primarily consisted of a network of variegated criminals organized in a strict, paramilitary hierarchy.James Schmidt, “‘Racket,’ ‘Monopoly,’ and the Dialectic of Enlightenment,” *Persistent Enlightenment*, January 2016; Andrew W. Cohen, “The Racketeer’s Progress: Commerce, Crime, and the Law in Chicaǵo, 1900-1940,” Journal of Urban History 29, no. 5 (July 2003): 575–96; Edward Granter, “Strictly Business: Critical Theory and the Society of Rackets,” Competition & Change 21, no. 2 (April 2017): 94–113; Robert M. Lombardo, Organized Crime in Chicago: Beyond the Mafia, (University of Illinois Press, 2012), 149–167. Through the efforts of anti-union propagandists, these terms came to be associated with (radical) union officials during the New Deal era, an attempt to hinder the extra-legal, “criminal” activities undertaken by unions for collective action.Ibid. In this context, Kirchheimer points out that lawyers used to frame “racket” as the “monopolistic practices […] carried through by physical force” for “singling out particularly objectionable methods serves as a convenient tool for bringing the guilty to account and depriving them of the sympathies of the community at large”Kirchheimer, “In Quest of Sovereignty,” 159. against who are deemed miscreants or criminals. In a critical re-appropriation of the term, Horkheimer generalizes the concept of the racket to encompass most groups with vested interests in the social reproduction of monopoly capitalism insofar as they directly or indirectly rely on personal domination and violence to sustain themselves. The civilized ruling class is revealed to have always consisted of various rackets, hidden in plain sight through its control over production and disciplinary mechanisms, unlike the racket of the criminal that represented “more irrational, more primitive racket relative to the state-protected class monopoly.”Horkheimer, “Theorie des Verbrechers” [1939-1942] in *Max Horkheimer gesammelte Schriften*, Bd. 12, 270 Hence, Kirchheimer points out that
if there is a difference in methods as between”haves” and “have-nots,” firstcomers and latecomers, “decent citizens” and “racketeers,” there is no difference in their aims which are essentially the same: establishment of domination over a segment of the process of production or distribution.Kirchheimer, “In Quest of Sovereignty,” 130.
In a letter to Franz Neumann, Horkheimer posits that (unlike the civilized rackets) the petty criminal skips over the “stage of production and seeks to appropriate to himself as much of the circulating surplus value as possible,”Horkheimer, “Theorie des Verbrechers” [1939-1942] in *Max Horkheimer gesammelte Schriften*, Bd. 12, 269 the criminal is an affront to the false universality of capitalist society who doesn’t keep up appearances, hence questions the very essence of capitalism. The criminal is disciplined through punishment to internalize the norms of society as more subtle institutions of socialization failed to do its job.Michel Foucault argues a similar point in *Discipline and Punish*. The early critical theorists recognize the non-identity between the goals of these institutions and the embodied individual that cannot be fully socialized as an object. There is room for mediated agency in their conception. In stark resemblance to Pashukanis’ argument regarding the legal form, Horkheimer observes that legal domination acquires its own logic immanent to capitalist social relations; unlike primitive sanctions or feudal punishment, the criminal as ordained by the legal form “is the exponent of a conflict necessarily inherent in society itself.”Horkheimer, “Theorie des Verbrechers” [1939-1942] in *Max Horkheimer gesammelte Schriften*, Bd. 12, 266 Criminal law shields the ruling rackets from the excesses that are generated by capitalist society, as those who cannot adapt to existing conditions lash out against those who benefit the most. The existing conditions that crush and exclude those who fail to keep up with its demands is rationalized in society by the “halo of necessity.”Horkheimer, “Authority and The Family,” 93. Poverty and crime are hypostatized as a natural part of any society, and the idea that ‘some people will always be poor or bad’ is instilled to civilized citizens through the universalization of the legal form and its constitutive ideological apparatuses. The legal institution becomes a tool of the ruling rackets in monopoly society to exert violence on the individuals and expand its horizons; the ruling class as rackets “make use of their productive apparatus as robbers make use of their guns.”Horkheimer, “On The Sociology of Class Relations.”
With monopoly capitalism, the combination of the rise of the relative surplus population with furthering integration of the circuits of capital into social life led to the development of “antagonisms within the ranks of the oppressed masses themselves.”Ibid. Rather than forming a class united by shared oppression/exploitation, the workers and the excluded are incentivized to form antagonistic groups within themselves (as rackets) as a response to the monopolistic organization of society—hierarchically organized and self-interested groups attempt to gain as much of the available social surplus through direct domination and violence directed towards other groups, regardless of their social position. The intra-class conflict of rackets within the ruling class is universalized under the antagonistic conditions of integration and exclusion, the employed section of the workers (in the global north) and their hierarchical trade unions, for Adorno (and Horkheimer), “became monopolies” that “terrorized outsiders” to secure their relative position.Adorno, *“*Reflections on Class Theory,” 100. The labour aristocracy is reframed as racket.In letters to Horkheimer, Franz Neumann and Herbert Marcuse pushed back against the argument that the working class has fully adapted to the monopolistic structures of society. Neumann in particular responds that only labour leaders (as managers) have been integrated into racket logic. For Horkheimer, however, the working class constitutes a conscious class rather than a racket only when it shares collective agency. (See Neumann’s letter to Horkheimer in *Max Horkheimer gesammelte Schriften*, Bd. 17, 482-483.) In one draft of the “Sociology of Class Relations”, Horkheimer incorporates the criticism by adding the paragraph but ultimately removes it — “There are some decisive differences between Labor and capitalistic monopolies(…)The term Labor, however, comprises both the leaders who appropriate the profits and the members who create them. The same process which, both in reality and ideology, has made Labor an economic subject, has transformed the laborer, who was already the object of the entrepreneur, into the object of his organization as well(…) While the masses think of themselves as the creators of their own destiny, the leaders use them as a commodity. The fact that Labor is a monopoly does not mean that its members, labor aristocracy excepted, are monopolists.” (Horkheimer, “On The Sociology of Class Relations.”) The revolutionary working class struggle is replaced by hierarchical labour organizations that trade labour as a “merchandise, manipulate it, advertise it, and try to fix its price as high as possible.”Ibid. With hindsight, we can observe that even these labour organizations in the global north have been largely disintegrated with the total expansion of market rationality throughout the world. Rackets appear not as part of the integration of working class organizations as it did during the 40s but as the result of exclusion and pauperization that accompanies capitalist integration. The anti-Democratic reactionary movements appearing the across the world such as MAGA, and the militant Hindu religious movements in India are accompanied by the rise of surplus populations being appropriated by the ruling rackets, the “criminal” that previously aroused the spirits of ruling classes by attempting to mimic their actions is a tool to be instrumentally used and subsequently discarded.In a letter to Horkheimer, Marcuse explicitly writes about the “harmony of interests between the union bureaucracy and the large monopolistic companies” and the “in some striking cases, the collaborationist attitude of the workers seems to be even stronger than that of the unions.” During the 1930’s lead to the “the famous Jack and Heintz factory in Cleveland (good article on it in the New Republic of Oct. 25), which is praised (also by the Communist Party) as paragon of the true relationships between workers. It is perhaps the most outstanding example of voluntary coordination of labor, and it shows how smoothly fascism can progress in a democratic environment.” (See Marcuse’s letter to Horkheimer in *Max Horkheimer gesammelte Schriften*, Bd. 17, 476-477.) Kirchheimer writes
Racket connotes a society in which individuals have lost the belief that compensation for their individual efforts will result from the mere functioning of impersonal market agencies. But it keeps in equal distance from, and does not incorporate, the idea of a society wherein the antagonism between men and inanimate elements of production has been dissolved in the image of a free association for the common use of productive forces. It is the experience of an associational practice which implies that neither the individual’s choice of an association nor the aims that the latter pursues are the result of conscious acts belonging to the realm of human freedom.Kirchheimer, “In Quest of Sovereignty,” 161.
Society tends towards the formation of competing “pressure” groups as rackets that does not hesitate to use any means necessary to carve out a space for its own reproduction through the acquisition of the circulating surplus value as an adaptation to the conditions of monopolization. The intensification of the impersonal forms of control characteristic of capitalist society through the market and the legal form in-turn intensifies the forms of personal domination that highlighted pre-capitalist social organizations, traditional forms of domination such as caste are explicitly mobilized as rackets to navigate class society. Horkheimer claims the primary function of groups is to protect itself from outside aggression, and stabilize its own social position in society. Hence groups themselves maintain the conditions of social reproduction “in which they have favored standing; they uphold and violently ward off changes that could endanger their monopoly. They are rackets.”Max Horkheimer, “Die Rackets und der Geist” in *Max Horkheimer gesammelte Schriften*, Bd. 12, 288 Durkheim’s false distinction between organic and mechanical solidarity collapses in-itself through racket logic, the division of labour organized through vast interconnected networks throughout society is maintained through personal relationships of domination in-and-between groups. What was purportedly in conflict with the forces of capitalism according to liberals was absorbed by capitalism for its continual expansion. As Horkheimer writes
“Today the expression of human needs is distorted no longer by the dubious economic indicators of the market, but by their conscious molding in a giant system of socio-psychological surgery. The misery of unsuccessful competitors and of backward groups can no longer be ascribed to anonymous processes which permitted a distinction between them as economic subjects and as human beings. The downfall of vanquished opponents, competitors as well as whole social strata, minorities and nations, is decided upon by the elites.”Horkheimer, “On The Sociology of Class Relations.”
The elite theory of Vilfredo Pareto is reframed as racket formation particular to specific social conditions rather than the transhistorical determination of power relations as such. For the early critical theorists, elite sociology partially describes the social dynamics within modern society but fails to understand its causes, which leads to its reactionary conclusions.Theodor W. Adorno, *Introduction to Sociology*, ed. Christoph Gödde, tr. Edmund Jephcott (Stanford University Press), 13–14. The partial description of elites circulating at the top throughout history as democracies are eventually reduced to oligarchies are rather the descriptions of rackets competing amongst themselves for resources while imposing strict control over their subjects. Unlike Pareto’s transhistorical formulation of the relations of power, the concept of the racket leaves the possibility of a truly free and democratic society open through the dissolution of rackets through the formation of a political class.
As James Schmidt points out, the language of rackets and monopoly were tactically removed from manuscripts that were eventually published as the Dialectic of Enlightenment to escape censorship by American authorities. They resorted to an esoteric mode of communication to develop an immanent critique of enlightenment rationality as it arises with the development of capitalism, it is particularly illuminating to understand the concepts introduced in the Dialectic to understand the functioning of class domination, misogyny and racism in monopoly society.Schmidt, “‘Racket,’ ‘Monopoly,’ and the Dialectic of Enlightenment,” and Eva-Maria Ziege, “The Irrationality of the Rational : The Frankfurt School and Its Theory of Society in the 1940s,” in *Antisemitism and the Constitution of Sociology* (University of Nebraska Press, 2014), 274–96.) Their primary thesis that enlightenment and myth are deeply interrelated with enlightenment rationality (with the transition to capitalism) leading to a blind domination over nature, alongside the explicit integration of tradition with capitalism.Ibid. Fascism was the result of identification with the blind forces of the economic apparatus.
Adorno and Horkheimer understand the return of mimesis in modernity as an adaptive response to the conditions of total integration of Capitalism with the domination of nature and eventually humanity.Theodor W Adorno and Max Horkheimer, *Dialectic of Enlightenment*, 2016, 148. The impersonal forces of capitalism i.e. the dominance of the market and the formal equality of the legal form, which leads to identification with the inert functioning of the world with itself. For Freud, the death drive is the attempt to conquer (qua mastery over) death through a constant repetition of the actions that brings the individuals close to an inorganic state, a drive to kill a part of oneself and identify with the external functioning world to conquer death itself.Sigmund Freud, *Beyond the Pleasure Principle: Group Psychology and Other Works ; (1920-1922)*, 38–55. Like the death drive, mimicry in capitalism is an irrational repetition to control the irrationality of existing reality, hence
“By echoing, repeating, imitating the surroundings, by adapting himself to all the powerful groups to which he belongs, by transforming himself from a human being into a member of specific organized bodies, by reducing his potentialities to readiness and ability to conform to, and gain influence in, such bodies, he can finally manage to survive. It is survival by practicing the oldest biological means of survival: mimicry. Modern culture is a resurrection of oppressed mimetic practices.”Horkheimer, “On The Sociology of Class Relations.”
Apropos mimesis, Rackets are “pragmatic totalities,” hierarchical organizations that are pragmatically oriented towards the existing world that hypostatizes the existing conditions of social reproduction. Pragmatism, both in its commonsensical and philosophical sense “corresponds to limitless trust in the existing world” Max Horkheimer, ed., “On the Problem of Truth,” in *Between Philosophy and Social Science: Selected Early Writings*, 192. Elderly advice and the realism of international politics amounts to the same things—anything that challenges the current state of affairs is deemed as a childish tantrum that fails to understand reality. For Horkheimer, the masses understand their own economic situation but that (immediately) does not translate into revolutionary class consciousness but is sublimated into the blind acceptance of existing reality as pragmatic/realist decision making. The philosophy of pragmatism of William James and John Dewey as its primary representatives limits the conception to truth to corroboration of ideas with use, it ends with reifying concepts for their usefulness as posited by the existing state of affairs.Ibid, 195. The convergence of philosophical thinking and the rationality of groups as pragmatic totalities is a mimetic response to the impersonal forces of the market. For Adorno, this limitless trust qua pragmatism leads to the flattening of everything to easily identifiable and measurable categories, all art (qua commodities) starts to resemble each other. Genuine differences are eliminated through the dream of eventually joining the ruling rackets.Adorno, “Reflections on Class Theory”, 96. Similarly Horkheimer write about this in the context of Caste Society: “The terrible differentiation in ways of work and life, which enables the Indian life-process to succeed, was rendered intelligible by the idea of the transmigration of souls, according to which birth into an upper or lower caste is the consequence of actions in an earlier life. The lowest classes find in this idea a special reason for not wanting any change in the system. In so far as a Pariah can say that he is faithful to the prescriptions for his caste, he hopes that in his next birth he will rise into the Brahman caste and enjoy its privileges.” (Horkheimer, “Authority and the Family,” 63) Adorno writes,
“the prisoners of the system, strive to bring about this leveling by imitating their stunted rulers in the hope of receiving a pittance in their old age, if only they can prove themselves worthy. The belief that they might be able to form an organized class and conduct a class war crumbles in the minds of the dispossessed along with liberal illusions.”Adorno, *“*Reflections on Class Theory”, 96.
Unlike the pragmatists, the objective of materialism (according to the early critical theorists) was to demonstrate that corroboration between ideas and reality qua the notion of use is itself a “historical occurrence” that arises in definite social relations. To demystify the concepts of realism that are taken as granted.
For instance, the so-called “natural” facts of human society such as a family are reframed as a hierarchical racket with the figure of the father at the top. The family that serves to socialize children into existing conditions through discipline and punishment, the child integrates herself the conditions of domination within the family unit through a memetic response, “submission to the categorical imperative of duty has been from the beginning a conscious goal of the bourgeois family.”Horkheimer, “Authority and the Family”, 99. The family qua racket is cemented as the primary conservative force in society that compels a sense of economic and social responsibility for the wife and children dependent on the husband’s reliance on a wage. Rebellion against the family and the patriarchal system is conceptualized as abandonment/disloyalty to one’s own group, domination is sublimated into the very consciousness of a person.Ibid, 120, Similarly, official legal titles are certifications that signify belonging to a racket through the state apropos the legal form. Individuals are integrated into the system through the process of certification, “legal and illegal titles […] are distinguished by the fact that the world has an all-embracing organization; none should escape its protection; if proscribed by its agencies, one is forsaken.”Horkheimer, “Die Rackets und der Geist” in *Max Horkheimer gesammelte Schriften*, Bd. 12, 289.
In the outline for a planned book on rackets, Horkheimer writes, “The fact that history is a history of class struggles means that history is a history of rackets fighting among themselves and against the rest of society.”Typescript “Notizen zum Programm des Buches, 3.8.1942,” Max Horkheimer Nachlass XI.10.1 https://arcinsys.hessen.de/arcinsys/detailAction.action?detailid=v3007298. Adorno similarly writes, “In the image of the latest economic phase, history is the history of monopolies. In the image of the manifest act of usurpation that is practiced nowadays by the leaders of capital and labor acting in consort, it is the history of gang wars and rackets.” Adorno, “Reflections on Class Theory,” 100. The concept of racket applied in history reveals the logic of domination immanent in class society that shackles the individual within groups, that in times of crisis results in a rapid unleashing of irrational destruction and violence. Under the limits imposed by class society, individuals are forced to integrate themselves into groups that will rule over groups below them—The oppressed become the oppressors of “those further down” the hierarchy.Ibid. Liberalism based on the idea of social contract between individuals in the state of nature, that will render individuals free from domination failed to fulfill its promise. Traditional forms of domination and rule that were understood as inadequate to liberalism was instead integrated into the economic apparatus, “by abolishing the classes in this way, class rule comes into its own.”Adorno, “Reflections on Class Theory,” 100. For the IfS, only through the establishment of a rationally organized society that with the association of free individualsHorkheimer, “Traditional and Critical Theory” in *Critical theory*, 218. by a conscious working class struggle will lead to the unfolding of genuine democracy and freedom.
Conclusion
In a letter to Horkheimer, Kirchheimer states that as ideology of existing conditions has deeply steeped into consciousness—it has been accompanied by a distrust of theory, rise in conspiratorial thinking, and explicitly anti-scientific sentiment. Ideology has “withdrawn from psychology into the anthropological fundament,”See Neumann’s letter to Horkheimer in *Max Horkheimer gesammelte Schriften*, Bd. 17, 482-483. which calls for a “materialist anthropology” to understand and supplant existing conditions.
The IfS had been writing during monopoly capitalism with authoritarian state presence throughout society apropos cold war liberalism, fascism and state socialism. Which starkly resembles neo-liberalism apropos the identity between unfettered market forces and state of today. Sociology of the racket provides us the framework to better understand the mutually interlocking relationship between reactionary organizations, class structure of a society with expansion of the informal economy and the democratic backsliding seen throughout the contemporary world—for instance the relationship between the state, big business, and militant Hindutva groups in India could be understood as composed of mutually interlocking rackets arising with large scale monopolization and decreasing economic stability. It provides a valuable research program to investigate our contemporary world.
Horkheimer writes about how initiation rituals of tribes could be understood as integration into rackets, the ritual signifying the socialization of an individual into group norms against the world.Horkheimer, “On The Sociology of Class Relations.” The sociology of the racket also shows the possibility of genuine freedom and democracy that can imagine a racket-free society made up of freely associating producers. The utopian potential of a liberated society, even at the darkest of time, even with total integration of everyone into an irrational society, the future remains open with possibilities through the very conditions of existing society. As Adorno writes,
In reified human beings reification finds its outer limits. They catch up with the technical forces of production in which the relations of production lie hidden: in this way these relations lose the shock of their alien nature because the alienation is so complete. But they may soon also lose their power. Only when the victims completely assume the features of the ruling civilization will they be capable of wresting them from the dominant power. The only remaining differentiating factor is reduced to naked usurpation. Only in its blind anonymity could the economy appear as fate: its spell is broken by the horror of the seeing dictatorship. The mimicking of the classless society by class society has been so successful that, while the oppressed have all been co-opted, the futility of all oppression becomes manifest. The ancient myth proves to be quite feeble in its new omnipotence. Even if the dynamic at work was always the same, its end today is not the end.Adorno, “Reflections on Class Theory,” 110.
Racket society produces its own antinomy with the formation of anti-racket political and artistic units with “with [their points] directed upwards”Max Horkheimer, “Die Rackets und der Geist.” that aim to abolish racket society through the formation of a political class of the exploited and subordinated.
