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The Frankfurt school of critical theory, founded as the Institute for Social Research in Germany in 1923, produced decades of theoretical and empirical work on capitalism before and after World War II. Although their main members, Theodor Adorno, Max Horkheimer, Herbert Marcuse, and, later, Jürgen Habermas, were trained in philosophy, their work, such as Adorno and his coauthors’ Authoritarian Personality book, is sociological and psychological in orientation. This entry focuses on the Frankfurt school in relation to other theoretical traditions and their conceptions of identity.

Marxism

The Frankfurt intellectuals were Marxists, although they felt that Marx's original critique of capitalism failed to anticipate two major developments in post–World War II capitalism: the culture industry, which manipulates people's needs and induces them to consume commodities beyond what they can afford, and the welfare state, put in place first by President Franklin Roosevelt. The culture industry relieves psychic crises of alienation and anomie. The welfare state intervenes directly in the faltering pure-market capitalist economy, against the laissez-faire recommendations of Adam Smith in The Wealth of Nations, in order to stimulate spending, create jobs, and buffer the poor against the poverty caused by unemployment. The Frankfurt school realized that in a “late” (post–free market) capitalism, identity has become a crucial political and economic factor. People's sense of who they are plays a major role in reproducing the existing economic system and in reducing the potential for organized countercapitalist social movements.

The Frankfurt theorists agreed with Marx that capitalism is prone to crisis, but they disagree that its collapse is inevitable, especially as capitalism finds ways to sustain itself. One of the main ways that capitalism protects itself is via subjectivity, or what social psychologists term the self. In effect, capitalism manipulates people's identities, needs, values, emotions, and even their experiences of the world. They are thus led to love or at least accept fatalistically what is not good for them: stress, workplace subordination, fundamentalism, endless shopping (on credit), fatty diets, and lack of exercise conceived as play.

Marx argued that workers are alienated in the sense that they neither own the factories in which they work nor control the working process. Profit goes to the business owner and profit is derived, according to Marx, from workers’ labor power. The Frankfurt theorists agreed with Marx's analysis, but they add that alienation has been deepened since the 19th century. Marx died in 1883, and he firmly believed that capitalism was on its death bed. But the culture industry and welfare state have prolonged capitalism and have yet to eliminate the basic contradiction (a term used by the philosopher Georg Wilhelm Friedrich Hegel) between the idea of workers (as owners or controllers of the working process) and their capitalist employers.

This deepened alienation was termed reification by the early 20th-century Hungarian Marxist, Georg Lukács, in his book History of Class Consciousness. To reify something—here, the self and its human relations—is to make it object-like, hard, and without sensibility or emotion. The Frankfurt theorists, partly influenced by Max Weber's theories of bureaucratic administration and hierarchy, argued that domination can be used to describe post–World War II capitalism in which, as Horkheimer phrased it, reason has been eclipsed. The self no longer thinks for itself but uncritically inhabits a cultural ether in which independent thought is nearly impossible.

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