This is a central historical concept of the Structural Transformation. The relationship between public and private is dynamic and complex. Habermas traces the two concepts back to ancient Greece, then through the hierarchical world of the middle ages, where public and private had no separate existence. Only with the development of a modern state and economy did public and private assume their currently recognized form. "Public" relates to public authority the state; "private" relates to the economy, society and the family. Public and private are defined and separated in terms of law, and of institutions. There are characteristic functions of the public and private realms. The public sphere exists as part of the private world that moves into the public domain.
The key shift in the modern world is the loss of the distinction between the two terms. Interest groups from either side of the public-private divide operate together. Public and private are replaced by one massive "societal" complex that is in some respects like the feudal state of the middle ages. When this happens, the public sphere in its traditional form is no longer possible.
Unsurprisingly, this concept is at the center of this work. "Structural transformation" describes the process by which the public sphere shifts from being the center of rational-critical debate, embedded within the constitution and within society, to being a debased version of its former self. Habermas conceives this shift as being dictated solely by structures changing in form and function. The structures he refers to are social, economic and political. They include institutions like coffee houses and salons, economic structures and a particular type of state structure. On a broader level, the division between public and private is a key structure that changes. His emphasis on structures rather than individual people or events reveals Habermas's debt to the sociological approach to society, despite the historical elements in his work. In later sections of the work, his defence of his own method reveals that he believes studying changing structures to be the only way of understanding the public sphere.
Habermas's view of modern politics is often pessimistic. He unfavorably compares the modern system to the eighteenth century public sphere. Although more people are now allowed to vote, modern politics is conducted in a debased public sphere produced by this expansion of the electorate and the operation of the "culture industry". The involvement of mass political parties and the apparatus of opinion management and political marketing mean that manipulative rather than critical publicity operates. If a "public" exists at all, it is frequently created by these devices for a specific purpose that does not involve rational debate. Habermas gives the example of the 1957 West German elections, where the government tried to bribe the electorate with promises of social security reforms. Politics, he implies, can be a deceitful process in the absence of real publicity. The modern political system claims to operate as a democracy in which power is legitimated by debate, but it is nothing of the sort.
Habermas holds out the possibility of reform, however. The answer is not to replace the expanded public sphere with a narrower version, or to attempt to return to an illusory golden age. Only by reconstructing the public sphere around large social institutions that have a firm basis in publicity can modern politics be transformed.
The public sphere takes a variety of forms in the Structural Transformation. After the demise of representative publicity, the literary public sphere emerges, then transforms into the political sphere in the public realm; it is enshrined in the bourgeois constitutional state as the bourgeois or liberal public sphere. Particular institutions such as periodicals, the press, and coffee houses characterize it, and it is embedded in certain economic and social conditions. The public sphere is not so much an actual place as a social realm that developed within various structures. It only really existed in conversation and discourse.
The most important feature of the public sphere is its simultaneous strength and weakness. It is robust enough to act as a real check on the power of the state, but yet is so dependent on precise socio-economic conditions that its existence is threatened by change. Its collapse in the modern world is not preordained, however, and Habermas holds out the hope of its successful return.