A Golden Opportunity? Edward Bernays and the Dilemma of Ethics

Abstract

In 1928, the Federal Trade Commission began a six-year-long investigation of the National Electric Light Association (NELA), who, for 15 years, had carried out a massive propaganda campaign intended to discourage public ownership of electric utilities, including, most notably, General Electric (GE). This article examines the relationship between Edward Bernays, NELA, and GE—especially given Bernays's involvement the following year in the GE-sponsored celebration of “Light's Golden Jubilee.” Bernays's defense of the techniques of propaganda on the one hand, and his belief in a new form of persuasion embodied in the ethical public relations counsel on the other, reveal both his idealism and his opportunism and, at the same time, call into question the ethicality of his actions.

Notes

Stewart Beach to Edward L. Bernays, July 11, 1928, Six Letters of Correspondence about “This Business of Propaganda,” Edward L. Bernays Papers, Container 422, Manuscript Division, Library of Congress, Washington, DC.

Ibid.

Ibid.

Stewart Beach to Edward L. Bernays, July 14, 1928, Six Letters of Correspondence about “This Business of Propaganda,” Edward L. Bernays Papers, Container 422, Manuscript Division, Library of Congress, Washington, DC.

Ibid.

Edward L. Bernays to Stewart Beach, July 18, 1928, Six Letters of Correspondence about “This Business of Propaganda,” Edward L. Bernays Papers, Container 422, Manuscript Division, Library of Congress, Washington, DC.

Edward L. Bernays, “This Business of Propaganda,” Independent, September 1, 1928, 198–199. Edward L. Bernays Papers, Container 422, Manuscript Division, Library of Congress, Washington, DC.

See, especially, Burton St. John III, Press Professionalization and Propaganda: The Rise of Journalistic Double-Mindedness, 1917–1941 (Amherst, NY: Cambria, 2010).

Thomas H. Bivins, Mixed Media: Moral Distinctions in Advertising, Public Relations, and Journalism, 2nd ed. (New York: Routledge, 2009).

Minette E. Drumwright and Patrick E. Murphy, “How Advertising Practitioners View Ethics: Moral Muteness, Moral Myopia, and Moral Imagination,” Journal of Advertising 33, no. 2 (2004): 7–24.

See, especially, Kathy Fitzpatrick and Candace Gauthier, “Toward a Professional Responsibility Theory of Public Relations Ethics,” Journal of Mass Media Ethics 15, nos. 2–3 (2001): 193–212.

Timothy Penning, “First Impressions: US Media Portrayals of Public Relations in the 1920s,” Journal of Communication Management 12, no. 4 (2008): 349.

Ibid., 354.

Burton St. John III, “Claiming Journalistic Truth: US Press Guardedness toward Edward L. Bernays’ Conception of the Minority Voice and the ‘Corroding Acid’ of Propaganda,” Journalism Studies 1, no. 3 (2009): 353.

Denise DeLorme and Fred Fedler, “Journalist's Hostility toward Public Relations: An Historical Analysis,” Public Relations Review 29, no. 2 (2003): 104.

Thomas H. Bivins, “‘And So There Developed a Special Profession’: The Effect of Early Journalism Codes and Press Criticism on the Professionalization of Public Relations” (presentation, International History of Public Relations conference, Bournemouth, UK, June 24–25, 2013).

Walter Lippmann, Public Opinion (New York: Harcourt, Brace, 1922), 345.

Herman J. Mankiewicz, “The Virtuous Press Agent,” New York Times, April 6, 1923, sec. III, 3.

Ernest Gruening, “The Higher Hokum,” Nation, April 16, 1924, 450.

Eric F. Goldman, Two-Way Street: The Emergence of the Public Relations Counsel (Boston: Bellman, 1948), 10.

GE Lighting, “History of Nela Park,” http://www.gelighting.com/na/business_lighting/education_resources/conferences/institute/history.htm.

Edward J. Covington, Franklin Silas Terry (1862–1926), Industrialist—Paragon of Organization, Harmony and Generosity (Highland Heights, OH: E. J. Covington, 1994), http://home.frognet.net/~ejcov/fsterry.html.

Ibid.

Chi-nien Chung, “Networks and Governance in Trade Associations: AEIC and NELA in the Development of the American Electricity Industry 1885–1910,” International Journal of Sociology and Social Policy 17, nos. 7–8 (1997): 52–110; Frank L. Dyer and Thomas C. Martin, Edison: His Life and Inventions (New York: Harper & Brothers, 1929), http://www.gutenberg.org/files/820/820-h/820-h.htm.

Covington, Franklin Silas Terry.

Ibid.

Ibid.; David E. Nye, “Public Relations as Covert Political Communication: The Debate over Public vs. Private Utilities in the United States,” American Studies in Scandinavia 16 (1984): 21–45; David E. Nye, Image Worlds: Corporate Identities at General Electric, 1890–1930 (Cambridge, MA: MIT Press, 1985).

There seems to be a lot of confusion in citations referring to NELA (the holding company whose name was changed to the National Electric Lamp Association in 1906) and NELA (the trade association, whose name was the National Electric Light Association, which was founded in 1885), mostly perpetuated by information in Nye's 1985 book (cited in note 27 above). Although otherwise authoritative, Nye conflates the two associations on page 18 when referring to the holding company and GE's stranglehold on the electric power industry. His information is subsequently cited by Ewen (cited in note 72 below, 216–217) and others as proof of GE's involvement in the National Electric Light Association's propaganda campaign. This is not to say that GE was not deeply involved in the scandal, but by the time of the FTC investigation in 1928, the holding company had already been broken up by Congress in 1911 using the Sherman Anti-Trust Act. It was subsequently absorbed by GE as the National Quality Lamp Division. In 1933, when it became clear that the National Electric Light Association's propaganda campaign was tainting GE's image, NELA was abolished and its successor became the Edison Electric Institute, which still exists today.

Smithsonian National Museum of American History, Kenneth E. Behring Center, Powering a Generation: Power History #2, http://americanhistory.si.edu/powering/past/h1main.htm; The New Deal Network, sponsored by the Franklin and Eleanor Roosevelt Institute, “Electricity in the Limelight: The Federal Theater Project Takes on the Power Industry,” http://newdeal.feri.org/power/essay01.htm; Paul W. White, “The Public Utility Company Act of 1935,” http://paulwwhite.com/the-public-utility-company-act-of-1935_316.html.

Covington, Franklin Silas Terry.

Nye, “Public Relations”; Nye, Image Worlds.

Chung; Dyer and Martin.

William E. Mosher and Finia G. Crawford, Public Utility Regulation (New York: Harper & Brothers, 1933), 327.

Energy Information Administration, Office of the Administrator, US Department of Energy, Public Utility Holding Company Act of 1935: 1935–1992 (Washington, DC: Government Printing Office, 1993).

US Congress, Temporary National Economic Committee, Investigation of Concentration of Economic Power, Monograph No. 26, Economic Power and Political Pressures (Washington, DC: Government Printing Office, 1941), 152.

Ferdinand Lundberg, America's 60 Families (New York: Vanguard, 1937), 302; Ernest Gruening, The Public Pays … and Still Pays: A Study of Power Propaganda (New York: Vanguard, 1931), 189–194.

Ibid., 153.

US Congress, Investigation, 153.

Ibid., 8.

US Federal Trade Commission, Annual Report of the Federal Trade Commission for the Fiscal Year Ended June 30, 1928 (Washington, DC: Government Printing Office, 1928), 28.

Ibid.

“Education: Indoctrination of Youth,” Time, December 31, 1929, http://www.time.com/time/printout/0,8816,928423,00.html.

Ibid.

US Congress, Temporary National Economic Committee, 76th Congress, Investigation of Concentration of Economic Power, Part 5-A: Federal Trade Commission Report on Monopolistic Practices in Industries (Washington, DC: Government Printing Office, 1939), 155.

Cited in Randal Marlin, Propaganda & the Ethics of Persuasion (Orchard Park, NY: Broadview, 1985), 192.

Ibid., 241.

Bernays, “This Business.”

Ibid.

Harold D. Lasswell, “Propaganda,” in Propaganda, ed. Robert Jackall (New York: NYU Press, 1995), 21.

Mark Crispin Miller, introduction to Bernays's Propaganda (Brooklyn, NY: Ig, 2005), 29.

Arthur A. W. H. Ponsonby in the introduction to Falsehood in War-Time: Propaganda Lies of the First World War (London: George Allen and Unwin, 1928), http://www.vlib.us/wwi/resources/archives/texts/t050824i/ponsonby.html#into.

Ibid.

Bernays, “This Business.”

“Business School Receives $90,000 from Utilities,” Harvard Crimson, April 29, 1929, http://www.thecrimson.com/article/1929/4/29/business-school-receives-90000-from-utilities.

Edward L. Bernays, “Propaganda and Impropaganda,” unpublished manuscript of speech presented at the 25th Convention of the Advertising Affiliation, Rochester, NY, June 9, 1929, 1. Edward L. Bernays Papers, Container 422, Manuscript Division, Library of Congress, Washington, DC.

Ibid.

Edward L. Bernays, “Urges Political Parties to Use Highest Technical Standards in Political Campaigns,” typescript attached to “Propaganda and Impropaganda.” May be a press release written by Bernays for the Rochester speech, 1929. Library of Congress Summary. Edward L. Bernays Papers, Container 422, Manuscript Division, Library of Congress, Washington, DC.

Bernays, “This Business.”

Beach to Bernays, July 11, 1928.

Nye, “Covert Communications,” 29; Thomas H. Bivins, Public Relations Writing: The Essentials of Style and Format, 7th ed. (New York: McGraw-Hill, 2011), 5.

John C. Long, A Handbook of Publicity (New York: McGraw-Hill, 1924), 137.

Marlin, 191.

Ivy Lee, Publicity: Some of the Things It Is and Is Not (New York: Industries, 1925), 23.

“Ivy Lee, Noted Authority of Publicity, Says Propaganda Is Great Force Today,” Daily Princetonian 44, no. 64 (May 6, 1930): 1.

US Congress, Economic Committee, 241.

Gruening, The Public Pays, 182.

Bernays, “This Business.”

Ibid.

Edward L. Bernays, “Are We Victims of Propaganda? A Debate,” offprint of article appearing in Forum Magazine, March 1929, Part II—“Our Debt to Propaganda,” Edward L. Bernays Papers, Container 422, Manuscript Division, Library of Congress, Washington, DC.

Bernays, “This Business.”

Nye, “Covert Communication,” 30.

Stuart Ewen, PR! A Social History of Spin (New York: Basic Books, 1996), 216–217.

Edward L. Bernays, Biography of an Idea (New York: Simon and Schuster, 1965), 445.

Marlen Pew, “The Propaganda Game,” Editor and Publisher, September 15, 1928, 32.

Will Irwin, Propaganda and the News: Or, What Makes You Think So? (New York: Whittlesey House, 1936), 120.

Bernays, Idea, 445.

Ibid., 448–449.

Ibid., 449.

Postage Stamps of the United States First Issued in 1929, http://www.1847usa.com/ByYear/1929.htm; Bernays, Idea, 450.

“Science: Golden Jubilee,” Time, May 7, 1929, http://www.time.com/time/printout/0,8816,927947,00.html.

Fitzpatrick and Gauthier, 206.

Michael D. Bayles, Professional Ethics, 2nd ed. (Belmont, CA: Wadsworth, 1989), 97.

See, especially, Stuart Ewen, PR!, and Larry Tye, The Father of Spin: Edward L. Bernays and the Birth of Public Relations (London: Picador, 2002).

Miller, Propaganda, 18–19.

Ibid., 21.

Harold D. Lasswell, “The Function of the Propagandist,” International Journal of Ethics 38, no. 3 (1928): 261.

New York Metropolitan Life Insurance Company, Functions of a Public Relations Counsel, 16, 1928. Bound typescript. Edward L. Bernays Papers, Container 507, Manuscript Division, Library of Congress, Washington, DC.

See, especially, Chester I. Barnard, C.I., The Functions of the Executive (London: Oxford University Press, 1938).

Drumwright and Murphy, “How Advertising Practitioners View Ethics,” 11.

Bernays, “This Business.”

Marlin, 194.

Bivins, Mixed Media, 22–24.

Sherry Baker, “Five Baselines for Justification in Persuasion,” Journal of Mass Media Ethics 14, no. 4 (1999): 60–81.

Stanley Walker, City Editor (New York: Frederick A. Stokes, 1934), 144.

Genevieve McBride, “Ethical Thought in Public Relations History: Seeking a Relevant Perspective,” Journal of Mass Media Ethics 4, no. 11 (1989): 15.

American Bar Association, ABA Model of Professional Accountability, EC 7-19 (1980).

Thomas H. Bivins, “Ethical Implications of the Relationship of Purpose to Role and Function in Public Relations,” Journal of Business Ethics 8, no. 1 (1989): 65–73.

Lawrence M. Hinman, Ethics: A Pluralistic Approach to Moral Theory, 4th ed. (Belmont, CA: Thomson Higher Education, 2008).