The strange case of America’s disappearing middle class
The Guardian, by Paul Mason
The shot was of two women in party dresses taking a selfie next to the Greek riot police. In the summer of 2015 it was an unremarkable sight – middle-class supporters of the euro rallying to save Greece from the threat of Grexit. But when I described the scene, in a voiceover aimed at an American audience, a query came back from the US: this does not sound right; they look too posh to be middle class.
Middle class, in the US, means what working class means in Britain. Except that, while nobody – even in Corbyn’s Labour party – goes around saying they represent “working-class values”, all politicians in America claim to represent the values of this middle class.
But the middle class is shrinking. A report from the Pew Research Center last week found that, for the first time since the 1970s, families defined as “middle income” are actually in a minority in the US – squeezed from both ends by an enlarged poverty-stricken group below them, and an enriched group above them.
The graphs showing the shrinkage read like a textbook example of the future that French economist Thomas Piketty predicts for the world. In 1971, there were 80 million households in the US defined as middle income – compared with a combined 52 million in the groups above and below. Now, there are 120 million middle-class families, but 121 million rich and poor – “A demographic shift that could signal a tipping point,” says Pew.
There has also been a big shift in who gets the wealth generated by America: “Fully 49% of US aggregate income went to upper-income households in 2014, up from 29% in 1970. The share accruing to middle-income households was 43% in 2014, down substantially from 62% in 1970.”
Middle America is, of course, supposed to be the bedrock of US democracy. The young family with kids, its income gradually rising as the years go by, is the foundation of political stability and consensus – and, although its quintessential era was the Keynesian years from 1945 to 1973, the dream, myth or other storytelling metaphor has survived. Until now.
The bare fact is that the majority of Americans, according to Pew, are either rich or poor. And this is beginning to have political impact. It would be facile to link the emergence of Donald Trump’s know-nothing, racist rhetoric to a mere demographic tipping point. But the insecurities he is playing on are real.
In part, the new demographics of the US are a success story: black people and older people have both, according to Pew, moved up the income scale. The clearest move downwards is among those who did not receive or complete a college education. That means the quintessential success story of the US is no longer the young, white, suburban family of the Bewitched and Doris Day legends. And the manual worker, the farmer and the self-taught salesman – all essential archetypes – no longer fit so easily into the success narrative.
Neoliberal economics favour the already rich and those rich in assets. This means, in an economy bulked out on the steroids of quantitative easing, older people. Meanwhile, for the young – whether of the precariat or those lucky enough to get into the stable workforce of corporate America – the debt accumulated while gaining the essential passport to middle-income status – a degree – serves as a lifetime drag on asset wealth.
This demographic tipping point creates, in short, more problems for America’s mainstream political narrative than it creates for the shrunken middle classes. Consensus is fragmenting. Social media thrusts footage of repeated police shootings of black or other minority Americans into our timelines. It thrusts the senseless mass shooter into the limelight. Now, it makes anti-Muslim hatred go viral.
Trump’s aim is not just to amplify these insecurities, but to create a politics of spectacle and senselessness around them. Businesspeople in the US are quietly despairing not just about the overtness of the racism, but also about the underlying irrationality of the discourse.
If fewer people get to work in technocratic jobs, where logic, prudence and care have to be followed every hour of every day, then, sooner or later, the acid of unreason begins to corrode democracy. That’s the fear: that values of science, logic and humanity get left behind as the fragmenting conservative right outshout each other.
It’s worth exploring the root cause of such fragility, though, because it is not obvious why the proportional decline of the middle class should trigger, causally, an implosion of reason as spectacular as the one being played out in the Republican primary battle. When you dig into the demography of the US middle class, a plausible answer emerges: it is more ethnically diverse than ever, there are fewer marriages than ever, it is better educated than ever.
Any conservatism – or any form of liberalism – that assumes as its default a middle class that is white, religious and uneducated is going to be misaligned with reality. But this new, diverse, more modern US middle class needs representation like never before. The average income of the upper tier, says Pew, is seven times that of the middle tier. In 1983, it was merely double.
As the primary season begins, beyond all the self-parody and craziness, the most serious questions for these 120 million households will be: who actually understands us, and who can offer us a plausible way beyond stagnating real incomes and multigenerational insecurity.