The origins of the circle of philosophers and social scientists now known as the Frankfurt School lie in the 1920s when a number of critics and intellectuals were attempting to adapt Marxism to the theoretical and political needs of the time. The distinguishing feature of the approach adopted by the Frankfurt School lies less in its theoretical orientation than in its explicit intention to include each of the disciplines of the social sciences in the project of a critical theory of society. The objectives of this theoretical innovation vis-à-vis all the traditional Marxist approaches were established by Max Horkheimer in various articles written in the 1920s and 1930s. His critique of neo-idealist philosophy and contemporary empiricism sought to develop a philosophy of history which would comprehend the evolution of human reason; in so doing, he drew on empirical research. Thus the Institute of Social Research, conceived as a way of realizing this plan, was founded in 1929. Its work drew on economics, psychology and cultural theory, seeking to analyse, from a historical perspective, how a rational organization of society might be achieved.
However, after the National Socialists came to power and drove the Institute into exile, historical/philosophical optimism gave way to cultural/critical pessimism. Horkheimer and Adorno now saw it as the function of a critical theory of society to try, by returning to the history of civilization, to establish the reasons for the emergence of Fascism and Stalinism. Their Dialectic of Enlightenment, which bears some resemblance to Heidegger, impressively testifies to this change of orientation: it asks why totalitarianism came into being and it identifies a cognitive and practical perspective on the world which, because of its concern with the technical control of objects and persons, only allows for an instrumental rationality.
But there was some opposition to this critique of reason which tended to view totalitarianism as a consequence of an inescapable cycle of instrumental reason and social control. The concept of total reification was called into question by some of the more marginal members of the Institute working under Adorno and Horkheimer. These were far more interested in asking whether, even under totalitarian conditions, they could determine the remains of a desire for communicative solidarity. The work of philosopher Walter Benjamin constitutes an analysis of the interrelation of power and the imagination; Franz Neumann and Otto Kirchheimer inquired into legal consensus culture and social control; while Erich Fromm conducted a psychoanalytic investigation of communicative needs and their potential for resistance.
After the core members of the School had returned from exile, the Institute resumed its work in Frankfurt and embarked on large-scale empirical projects. From the very beginning, however, a considerable gap existed between the empirical investigations which focused on the industrial workplace and the philosophical radicalization of negativity on which Adorno and Horkheimer worked, albeit with differing emphasis. This gap was bridged only when Habermas began to challenge the systematic bases of critical theory, causing the basic philosophical concepts and the intentions of empirical social research once again to correspond. The central idea, with which Habermas introduced a new phase in the history of the Frankfurt School, was his understanding of a form of rationality which would describe the communicative agreement between subjects rather than the instrumental control of things. The concept of communicative rationality which emerged from this idea has since formed the basis for the moral grounds and democratic application of critical theory.
Towards a Critical Theory of the Technosystem