Written by Anna D.
The Walt Disney Company is an example of a global media conglomerate focused on the provision of intangible entertainment and tangible products including souvenirs and merchandise (Disney, 2018). The following figure reviews the latest financial figures reported by Disney.
Figure 1: The Financial Performance of Disney
Source: Disney (2018, p.12)
In 2018, the company was able to earn a total of $59.4 billion, meaning that the firm has developed a strong capacity for generating value and earning revenue (Disney, 2018). This was further illustrated by the significance of its inorganic growth such as the acquisition of the Fox film studio (Disney, 2018). One question that could emerge from the firm’s activities was whether Disney could be considered a stereotypical capitalist as was originally defined by Karl Marx (Evans, 1975). The goal of this essay is to review the structure and business operations of Disney from the Marxist point of view.
Evaluating Disney from the Marxist Point of View
This part of the essay relies on 3 criteria proposed in classical Marxism, namely appropriating the means of production, the class struggle and the balance of profits.
Disney and the Appropriation of the Means of Production
According to classical Marxism, capitalism is characterised by its dominance in capturing the means of production with human labour being the primary resource for all economic activities (Evans, 1975; Elster, 1986). This means that capitalism necessitated establishing a distance between the worker and the product of their labour with capitalists controlling both inputs and outputs (Elster, 1986; Keith and Charalambous, 2016). From this point of view, the Disney corporation presents an unambiguous example of a capitalist organisation. Its merchandise and souvenirs could be considered as an example of business outputs. By possessing the exclusive rights to produce merchandise based on its intellectual property, Disney demonstrated its acquisition of the means of production (Wei, 2018). In other words, the creative outputs of the workers of Disney did not belong to the employees but the company itself. This was further illustrated by Disney being able to continuously expand its portfolio of intellectual properties such as the Star Wars brand. One critique of such a perspective was that Disney was arguably reliant on its employees to maintain its competitiveness.
It was the creativity of the workers that determined the success of the different enterprises established by Disney such as its expansion into Broadway (Thomas, 2019). However, other scholars argued that maintaining such a relationship between a capitalist and their subordinates did not necessarily avert the main principles of capitalism (Koch et al., 2019). In their review of this issue, Koch et al. (2019) noted that persistent self-employment produced high rates of income and high average job satisfaction. This meant that at least partially controlling the means of production was ultimately beneficial for the workers themselves. Another argument in favour of the traditional Marxist perspective was that the employees were reliant on Disney to transform their efforts into profit (Wei, 2018; Disney, 2018). This meant that the means of production and the capabilities possessed by Disney (such as its ability to access large developing markets) provided the firm with a high degree of power over its workers.
One question was whether the tenets of Marxism were applicable to highly creative industries such as the film sector and the video game setting; Disney had a strong presence in both of these areas of business (Disney, 2018). On the one hand, controlling the means of production was a universal feature of capitalism (Evans, 1975; Elster, 1986). On the other hand, the uniqueness and the intangibility of the output of the workers arguably provided a contradiction to classical Marxism. This raised the question of how exactly Disney exerted its control in creative industries. The essay argues that creativity did not necessarily mean an escape from capitalism. According to Lampel and Germain (2016), creative industries were the hubs of business and managerial innovation such as increased work flexibility. Nonetheless, workers in creative industries still produced a labour surplus that allowed their employers to earn profits (Lampel and Germain, 2016). As an illustration, the share awards for employees of Disney were only equal to $0.03 per diluted share in 2017 (Disney, 2018). This meant that the corporation was able to control wages, thus presenting a major example of exploiting its workers.
Class Struggles in the Context of Disney
The original works of Karl Marx also heavily focused on the class struggle between the proletariat (possessing the labour power) and the bourgeoisie (the owners of the means of production) (Evans, 1975; Elster, 1986). The question was whether the Disney corporation could be considered as a bourgeoisie. As was acknowledged by the corporation, its employees possessed high bargaining power established through worker unions and collective agreements (Disney, 2018). Nonetheless, the essay questions whether these regulations were sufficient to ensure equality between the regular workers of Disney and the firm’s high-ranking stakeholders. One point of view was that the wealth disparity between the employees of Disney and their supervisors was significant. The recent statistics demonstrated that 80% of workers of Disneylands in the US earned less than $12 per hour. This contrasted with the CEO of Disney, Robert Iger, receiving a $434 million bonus at the end of 2017 (Sanders, 2018).
Such a discrepancy was congruent with the classical definitions of a class struggle suggested by Marxism (Gregor, 2019). In classical rivalry, the class warfare was driven by the bourgeoisie accruing significant amounts of wealth while the proletariat had to bargain its labour power to earn the finances necessary for satisfying their core needs (Leonardi, 2019). The recent Disneyland worker rallies have gathered more than 2,000 workers dissatisfied with their wages (Sanders, 2018). This demonstrated that the Marxist class struggle was explicit in the case of the Disney corporation. Classical Marxism postulated that the class struggle could only be resolved by a means of a revolution which constituted a noticeable shortcoming (Evans, 1975; Elster, 1986). In contrast to this point of view, the current generation of democratic socialists argued that the implementation of new policies and lawful protection of worker rights was necessary to resolve the fundamental issues raised by capitalism (Sanders, 2018). It was questionable whether the organised protests conducted by the Disneyland workers were sufficient to bridge the wealth gap between themselves and the CEO of Disney.
The Balance of Profits in the Case of Disney
One argument originally made by Karl Marx was that capitalism was ultimately non-sustainable in the long-term perspective (Elster, 1986; Barca, 2019). As technology developed, the financial expenditures for maintaining one’s competitive position increased, leading to a significant decrease in profits (Evans, 1975). This was not necessarily the case for the Disney corporation. In 2017, its investment activities cost the firm $4 billion; the same figure was equal to $5 billion in 2018 (Disney, 2018). Within the same time period, the company’s revenue increased from $51 billion to $59 billion. The essay admits that Marx defined economic outcomes that could take decades to manifest (Elster, 1986). Nevertheless, the ability of Disney to increase its revenues while also increasing its expenses on investments and technology clearly demonstrated that appropriating the means of production provided a potentially unlimited option to earn profits (Disney, 2018).
One common critique of traditional Marxism was that the principle of the balance of profits ignored external factors such as social institutions and consumer behaviours (Acemoglu and Robertson, 2018). The context of Disney’s financial success strongly supported this statement. In their analysis of the business and political environment in the US, Sanders (2018) concluded that the US political system arguably facilitated the creation of the wealth gap between the proletarian and the bourgeoisie. For example, the recent tax cuts for corporations meant that Disney and similar large conglomerates were able to earn more profit while maintaining large levels of investments into technology (Sanders, 2018). Another contributor was the significance of developing markets for Disney with China being the most prominent example (Wei, 2018). The lack of regulations protecting the rights of employees in China and congruence with corporate interests meant that Disney was able to expand its presence in this sector without incurring a significant penalty to its profits (Qin, 2019; SDR, 2020).
Conclusions and Implications
The present essay demonstrated that the Walt Disney Company fit the main criteria established by classical Marxism. The organisation arguably appropriated the means of production and was able to exploit its labourers. Of particular significance was the wealth gap between the regular employees of Disney and its high-level stakeholders, highlighting the significance of financial inequalities within the firm. Nonetheless, the analysis argued against specific principles of traditional Marxism. The case of Disney clearly suggested that capitalism was a financially sustainable economic paradigm. The theoretical implication was that Marxism was a rigid framework of social and economic relations which was unable to account for the complexity of the modern phenomena in the field of business. The existence of firms such as Disney meant that Marxism failed to predict the financial stability of capitalism. Future researchers of Marxism could benefit from reviewing other cases of large global companies.
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