Although I have concentrated very clearly on the big names of classical Frankfurt school history and their relationship to fascism, capitalism and the conditions created by the Weimar Republic, the Frankfurt school still exists today. Its influence, largely through Jürgen Habermas and Axel Honneth, remains considerable. From early Adorno to late Habermas and on to Honneth is a very great distance but there are certain threads running through all of this work. As Axel Honneth himself points out, one of these threads is the idea of reification. He goes back to Georgy Lukacs's work on this concept in his History and Class Consciousness from 1925 to point out that although the term went out of fashion in the postwar period, apart from its short-lived rediscovery by the 1968 movement, it has never really gone away and is beginning to re-emerge today.

Reification in one form or another has been the determining concept of western Marxism since the Bolshevik revolution. It defines the early Frankfurt school attempts to understand fascism as the externalisation of repressed desires; it underpins Walter Benjamin's aesthetic theories in which he describes fascism as the "aestheticisation of politics"; equally, it forms the base of Herbert Marcuse's concept of the one-dimensional man, that dimension representing merely the reified desires of consumer culture.

However, when we talk of the second and third generations of the Frankfurt school, represented by Habermas and Honneth respectively, we are speaking more of a break within the tradition rather than continuity. This is, of course, not that surprising. The world of Weimar and fascism in which the first generation grew up was a very different one to the apparent glittering success of "classless" liberal democratic (West) Germany.

Honneth goes back beyond Lukács and Marx to early Hegel and locates the basis of reification not in social, economic or structural terms but in the problem of "recognition" or what Plato called Thymos which, alongside reason and eros form the three basic parts of our psyche. Of course this platonic triad could be said to be equal to the Freudian division into id (eros), ego (reason) and superego (thymos) and in that sense, reification continues the psychoanalytical tradition within the Frankfurt school. But Honneth also de-ideologises it by removing structural economic factors and foregrounding individual psychology.

Thymos is also at the root of Fukuyama's theory of the end of history in that he believed that there can be no new stage beyond liberal democracy precisely because it is liberal democracy which guarantees the greatest possible level of recognition of the individual. This means that rather than seeking to be rid of reification by overthrowing the structures of the capitalist system which bring about our alienation and exploitation, we have to concentrate on improving and ameliorating the conditions of capitalism and liberal democracy to the point where we can gain full individual recognition as human subjects. So Fukuyama's theory turns on its head Adorno's dictum that there can be nothing true within a false system and maintains that not everything in a modern liberal capitalist democracy can be said to have a reifying and alienating effect but that the system itself is potentially open to constant reform and improvement.

With the triumph of consumer capitalism in the west during the 1950s and 60s and the absence of any serious crisis of capitalism and resulting proletarian uprising, questions about identity, politics and ideology had to be seriously rethought. Critical theory had to develop an explanatory power to deal with that absence and the realisation that – to paraphrase Marx – consumerism had replaced religion, but this time as the sigh of the unoppressed creature in a non-hostile world.

Habermas originally based himself in a critical Hegelian Marxist approach but by the late 1960s had moved away from the concerns of the first generation. By 1979 he said that he did not share "the premise that instrumental reason has gained such dominance that there is really no way out of a total system of delusion in which insight is achieved only in flashes by isolated individuals."

Rather than maintaining that nothing could be done to improve conditions until capital had been dislodged and replaced by a socialist system he was much more interested in finding ways in which the public sphere could be gradually transformed into a space where domination by the media and the big ideological apparatuses of the system could be replaced by interactive and intersubjective dialogue from below. This "discourse theory" led to his major work The Theory of Communicative Action (1981) in which he asks how the first generation were able to step outside of the totality of repressive relations in order to be able to criticise those relations. If they were so totalising then surely those applying critical theory to them were also part of the repressed totality.

This is a long way from the glory days of Marxo-Freudian critique but Habermas's main concern is to maintain the defence of reason, science, modernity, and universal human values against what he sees as the perennial threat of slipping back into irrational regressive fears.