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The New Class War
Saving Democracy from the Metropolitan Elite
Michael Lind
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The New Class War
Saving Democracy from the Metropolitan Elite
Michael Lind
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About This Book
An Evening Standard' s Book of the Year
'A tour de force.' David Goodhart All over the West, party systems have shattered and governments have been thrown into turmoil. The embattled establishment claims that these populist insurgencies seek to overthrow liberal democracy. The truth is no less alarming but is more complex: Western democracies are being torn apart by a new class war.In this controversial and groundbreaking analysis, Michael Lind, one of America's leading thinkers, debunks the idea that the insurgencies are primarily the result of bigotry and reveals the real battle lines. He traces how the breakdown of class compromises has left large populations in Western democracies politically adrift. We live in a globalized world that benefits elites in high income 'hubs' while suppressing the economic and social interests of those in more traditional lower-wage 'heartlands'.A bold framework for understanding the world, The New Class War argues that only a fresh class settlement can avert a never-ending cycle of clashes between oligarchs and populists - and save democracy.
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GlobalisierungCHAPTER ONE
The New Class War
THE COLD WAR has been followed by the class war. A transatlantic class war has broken out simultaneously in many Western countries between elites based in the corporate, financial, government, media, and educational sectors and disproportionately native working-class populists. The old spectrum of left and right has given way to a new dichotomy in politics among insiders and outsiders.*
None of the dominant political ideologies of the West can explain the new class war, because all of them pretend that enduring, self-perpetuating social classes no longer exist in the West.
Technocratic neoliberalismâthe hegemonic ideology of the transatlantic eliteâpretends that inherited class status has virtually disappeared in societies that are purely meritocratic, with the exception of barriers to individual upward mobility that still exist because of racism and misogyny. Unable to acknowledge the existence of social class, much less to discuss conflicts among classes, neoliberals tend to attribute populism to bigotry or frustration on the part of maladjusted individuals or a resurgence of 1930s fascism or the sinister machinations of Russian president Vladimir Putinâs nationalist regime.
Like neoliberalism, mainstream conservatism assumes that hereditary classes no longer exist in the West. Along with neoliberals and libertarians, establishment conservatives claim that the economic elite is not a semihereditary class but rather an ever-changing, kaleidoscopic aggregate of talented and hardworking individuals. According to libertarian conservative ideology, the short-term interests of employers are always identical with those of workers and society as a whole. In conventional conservative thought, meritocratic capitalism is threatened from within by an anticapitalist ânew classâ consisting of progressive intellectualsâprofessors, journalists, and nonprofit activists.
For its part, Marxism takes classes and class conflict seriously. But orthodox Marxism, with its secularized providential theory of history and its view of industrial workers as the cosmopolitan agents of global revolution, has always been absurd.
A body of thought does exist that can explain the current upheavals in the West and the world. It is James Burnhamâs theory of the managerial revolution, supplemented by the economic sociology of John Kenneth Galbraith. Burnhamâs thought has recently enjoyed a revival among thinkers of the American center-right.1 Unfortunately, Galbraithâs sociology, along with his economics, remains out of fashion.2
James Burnham was a leader in the international Trotskyist movement in the 1930s before he became a zealous anticommunist and helped to found the postâWorld War II American conservative movement. Burnham was influenced by the argument of Adolf Berle and Gardiner Means in The Modern Corporation and Private Property (1932), which documented the separation of ownership and control in large-scale modern enterprises, and possibly by Bruno Rizziâs Bureaucratization of the World (1939).3 In his worldwide bestseller The Managerial Revolution (1941), Burnham argued that in the era of large-scale capitalism and the bureaucratic state, the older bourgeoisie was being replaced by a new managerial class:
What is occurring in this transition is a drive for social domination, for power and privilege, for the position of ruling class, by the social group or class of the managers. . . . At the conclusion of the transition period the managers will, in fact, have achieved social dominance, will be the ruling class in society. This drive, moreover, is world-wide in extent, already well advanced in all nations, though at different levels of development in different nations.4
In his essay âSecond Thoughts on James Burnhamâ (1946), George Orwell provided a succinct summary of Burnhamâs thesis:
Capitalism is disappearing, but Socialism is not replacing it. What is now arising is a new kind of planned, centralized society which will be neither capitalist nor, in any accepted sense of the word, democratic. The rulers of this new society will be the people who effectively control the means of production: that is, business executives, technicians, bureaucrats and soldiers, lumped together by Burnham, under the name of âmanagers.â These people will eliminate the old capitalist class, crush the working class, and so organize society that all power and economic privilege remain in their own hands. Private property rights will be abolished, but common ownership will not be established. The new âmanagerialâ societies will not consist of a patchwork of small, independent states, but of great superstates grouped round the main industrial centres in Europe, Asia, and America. These super-states will fight among themselves for possession of the remaining uncaptured portions of the earth, but will probably be unable to conquer one another completely. Internally, each society will be hierarchical, with an aristocracy of talent at the top and a mass of semi-slaves at the bottom.5
Following the abandonment of communism, the global norm in both developed and developing countries, democratic and authoritarian alike, has been some version of the mixed economy dominated by bureaucratic corporations, bureaucratic government, and bureaucratic nonprofits, which are staffed by university-credentialed national elites who circulate among the three sectors. What Orwell called Burnhamâs âgreat super-states grouped round the main industrial centres in Europe, Asia, and Americaâ exist today under the names of NATO and NAFTA, the EU, Russiaâs Eurasian Economic Union (EAEU), and the informal sphere of influence coalescing around China.
While private property rights have not been abolished, even in so-called capitalist countries they have been diluted and redefined beyond recognition. Vast numbers of temporary holders of corporate shares that are frequently bought and resold by intermediaries like mutual funds are said to âownâ corporations. Ordinary people with loan repayment or installment plans who in effect are renting houses, cars, and phones from banks or corporations likewise are owners in name only.
Burnhamâs theory of the managerial revolution is similar to the economic sociology of the American economist John Kenneth Galbraith. In their politics, the conservative Burnham and the liberal Galbraith could hardly have been more different from each other, despite their shared friendship with the influential conservative editor and journalist William F. Buckley Jr. Yet both believed that a new ruling elite had displaced the old bourgeoisie and aristocracy. In The New Industrial State (1967), Galbraith called the new elite the âtechnostructure.â In his memoir A Life in Our Times (1981), Galbraith wrote: âJames Burnham, partly because he was a stalwart right-winger well out of the political mainstream and partly because he was not a certified academician, never got full credit for his contribution. In early editions of The New Industrial State I was among those in default.â6
While Burnham and Galbraith included engineers and scientists in the new elite, they were not describing a technocracy like the utopian âsoviet of techniciansâ hoped for by the maverick economist Thorstein Veblen.7 The most important managers are private and public bureaucrats who run large national and global corporations, government agencies, and nonprofit organizations. They exercise disproportionate influence in politics and society by virtue of their institutional positions in large, powerful bureaucracies. Some are independently wealthy, but most are salaried employees or fee-earning professionals. Most of todayâs billionaires were born into this university-educated, credentialed, bureaucratic upper middle class, and their heirs tend to disappear back into it in a generation or two. Premodern titled aristocrats who survive in the contemporary West are anachronisms who, for the most part, avoid ridicule by disguising themselves as hardworking professionals and managers.
IN MY BOOK The Next American Nation (1995), I used the term âoverclassâ to describe this group of college-educated managers and professionals.
How big is the overclass? Itâs difficult to measure, but operating on Mark Bovens and Anchrit Willeâs theory that Western democracies are âdiploma democraciesâââruled by the citizens with the highest degreesââwe can count higher education as a market of membership in the overclass.8
In both Europe and the US, only about three out of ten citizens have college degrees, and that a third of the population provides almost all government, business, media, and nonprofit personnel. Even fewer citizens have the professional or graduate degrees that more accurately correspond with membership in the college-educated managerial overclassâno more than 10 or 15 percent of the population in a typical Western nation, a small minority, though considerably larger than the much-discussed â1 percent.â This credentialed overclass owns roughly half the wealth in the United States, with the rest divided between the superrich and the bottom 90 percent.9
Are the managers and professionals an inbred, self-perpetuating, hereditary class as well as an educational elite? In a purely meritocratic society, the ranks of university-educated managers and professionals might be refilled completely by upwardly mobile individuals in each generation. In the United States, however, American college students tend to have one or more college-educated parents. In other Western democracies as well, membership in the university-educated managerial class is also partly hereditary, though partly open to talent from below.10
In the United States and Europe, intergenerational mobility, measured crudely by correlation between the earnings of fathers and sons, is strikingly low. According to Julia B. Isaacs of the Brookings Institution, roughly half of the âparental earnings advantageâ is inherited by sons: âIf trends hold, it would take an average of six generations for family economic advantage to disappear in the United States and the United Kingdom.â In Canada, Norway, Finland, and Denmark, social mobility is somewhat higher, such that âit would take three, not six, generations, to essentially cancel out the effects of being born into a wealthy family.â11 If only America were more like social democratic Europe, it would take only three generations to make a gentleman.
The persistence of class in Britain is even more striking. Gregory Clark and Neil Cummins have demonstrated that Britons with Norman French surnames like Darcy, Mandeville, Percy, and Montgomery have been at the top of the British social order for twenty-seven generations since the Norman conquest in 1066, while families with Anglo-Saxon names like Sidwell, Tonbridge, and Goodhill still tend to be poorer and less educated.12
It may be true that college degrees are tickets out of poverty, but most of the tickets are passed out at birth to children in a small number of families with a lot of money. In the United States, students with math scores in the bottom half who come from families with the highest socioeconomic status are more likely to finish a college degree than students from families with the lowest socioeconomic status who have math scores in the top half of the range.13 In a true meritocracy, the mediocre children of college-educated parents would constantly be tumbling down into the non-college-educated working class, replaced by smarter, upwardly mobile scions of the working c...