U.S. Politics and the Global Economy: Corporate Power, Conservative Shift

Explaining the massive shift of business support to the presidential campaign of Ronald Reagan requires understanding the long-term and shortterm trends within the global political economy during the last two years of the Carter administration. By the late 1970s, no effective political coalition could be built without taking into account the interrelationship between domestic and global politics. The most noteworthy political events of the second half of Carter's presidency involved a massive defection of liberal internationalists away from the Democratic Party and toward support for a Republican candidate who a short while earlier had been on the right-wing fringes of the party, unable to muster a broad base of business support beyond the “Goldwater coalition” of textile firms, independent oil producers, and military contractors. ¹

The movement of multinational corporate elites to the Reagan candidacy reflected a complex array of motivations that included considerable business support for rolling back the welfare state, especially aid targeted to the poor and the federal regulation of business, along with a commitment to increase military spending well beyond the limits of the Carter presidency. In addition, international financial interests, especially Chase Manhattan, Citibank, and the entire northeastern U.S. corridor of international commercial and investment banks, favored aggressive efforts to reverse the monetary plight of the dollar, in free fall during the last years of the Carter administration. ²

The major events triggering support for a rightward shift of Carter's foreign and domestic policies in the last two years of his administration also led to increased and diverse business support for Ronald Reagan in the 1980 election. First of all, structural and long-term factors within the global political economy provided serious challenges to the array of U.S.based multinational corporations that had previously supported the embedded liberalism of the Bretton Woods financial regime. ³ As detailed in

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