Restoring Which Middle Class?

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Article by Andrew Ross on the middle class and the US presidential campaigns

Sounding the alarm about the “disappearance” of the middle class has been a persistent feature of American political life over the last two decades. Given that aspiring national leaders and managers routinely refer to the American people as generically middle class (the term “working class’ was long ago expunged from mainstream political speech), the erosion of middle-income strata is especially threatening to national self-imagery. The corresponding expansion of the “discount” and the “luxury” classes, to use the consumer market terminology, also runs against the grain of the American democratic ethos. This credo was maintained throughout the twentieth century by a succession of presidential promises to rein in the plutocracy and deliver a measure of equity, from Theodore Roosevelt’s “Square Deal” to FDR’s “New Deal,” Harry Truman’s “Fair Deal,” and LBJ’s “Great Society.” The contemporary version comes in the much weaker form of pledges to “restore the middle class.”

In the face of rampant class polarization, neoliberal advocates like to point out that the volume of those joining the ranks of the prosperous is greater than those falling into poverty, but there are other, less rosy ways of crunching the numbers, including the now infamous data (collected by Piketty and Saez) on the 1%’s monopoly on wealth accumulation. A recent study from the Stanford Center on Poverty and Inequality showed that the top 1 percent share of the nation’s wealth soared from 25 percent in the 1970s to 42 percent in 2012. A more telling statistic is a recent Federal Reserve estimate (more conservative than others) that almost half of the American population could not pay for an unexpected $400 expense without selling something or borrowing money. Living that close to the fiscal edge does not approximate to any received notion of middle-class stability.

The making of the vaunted US middle class in the postwar era was a combination of capitalist expansion in markets that had no strong global competitors, the projection of trade union power, and significant state investment in social goods. The underlying compact (or armed truce) between capital and labor fell apart in the 1970s, and median US wages have more or less stagnated since that period, despite a 200% increase in productivity. Cheap credit was the only factor holding middle class heads above the water in the three decades between 1978 and 2008, and the debt-fueled fantasy of the “ownership society” dissolved in the wake of the financial crash. Despite the claim by consensus economists that the so-called “debt overhang” from 2008 has been resolved, aggregate household debt has been steadily climbing back to pre-crash levels (reaching $12.12 trillion overall in December 2015). Student debt, which never faltered, and which has become the single biggest burden on middle class budgets, continues to rise inexorably.

In retrospect, it is clear that the hasty conferral of middle class status on working class families in the immediate postwar period was premature. High union wages for primary sector workers were a blessing, as long as the postwar contract lasted, but

heavily subsidized homeownership (for almost exclusively white, male-headed households) was the ultimate key to unlocking this status, and when the mortgage securities racket finally fell apart in 2008, this debt-driven formula for securing a “wealth asset” in the absence of rising income was decimated. Through home foreclosures alone, African American households lost more than half of the wealth they had accumulated since the mortgage market was made accessible to them, under federal pressure. Latino household wealth dropped by 66 percent. In light of these deflated circumstances, and the racial wealth gap that the ownership society” ended up widening, any campaign for restoring a faux middle class through the revival of all-access cheap credit sounds quite shabby, even predacious.

The political blowback for Washington’s bailout of the Wall Street banks has been slow but sure, and there can be little doubt that we are seeing some of the impacts in the current presidential campaigns, currently offering more departures from business as usual than we have seen in a long time. When Senator Elizabeth Warren, the scourge of Wall Street, balked at taking on Hilary Clinton, another female Democrat, Bernie Sanders stepped up to lead the charge against neoliberal austerity politics, and he has done so with great brio, refusing to run away from the “democratic socialist” label that opponent had hoped would turn into an electoral curse. The “discovery,” by pollsters that so many young Americans also identify as “socialists,” is usually diagnosed by pundits as a purely anomalous symptom of an election season where the political class appears to have lost control over the process.

In the case of Democrats, this breach of deference may turn out to be temporary, especially if Hilary Clinton expediently moves far enough left of center to absorb the force of Sanders’ challenge. The crisis is much deeper on the other side of aisle. Confronted with the mercurial rise of Donald Trump, the long-standing conservative coalition appears to be finally coming apart at the seams. This unstable entente between the socially moderate business class and the Christian-led “moral majority” had always been a tough balancing act (dating back to William F. Buckley’s efforts to make peace with the “godless” Ayn Rand), and it only held together as an electoral machine by incorporating the revanchist Southern politics of white supremacy.

Pundits looking for a ready-made explanation for these disruptions are inclined to turn to populism because it can easily be associated with untutored, and thus irrational, even paranoid, impulses on the part of the masses who feel excluded from the orbit of decision-making. Populism is typically described as “rearing its head” in hard times, as if were some rough beast (not to be confused with the “animal sprits” of the creditor class) that is ordinarily kept in check when paternalist democracy is working properly. This kind of analysis--“the brute is loose”–seldom fails to cite Richard Hofstader’s 1964 “The Paranoid Style in American Politics,” penned just after the insurgent libertarian Barry Goldwater wrested the presidential nomination from Nelson Rockefeller, the consummate business Republican. Plumbing the deep affection for conspiracy theory that ran through the long, historical succession of anti-Masonic, anti-Catholic, and anti-Communist moments, Hofstader provided a “psychiatric” explanation for the angry, nativist temper of the new conservatism. In his account, the paranoia was an expression of dispossessed or downworldly mobile class fractions, who projected conspiratorial, even treasonous, behavior onto (East Coast) elites. The analogy with Trump’s popularity is self-evident (in Trump’s world, all of his rivals are the “losers”), though not entirely persuasive.

Hofstader’s analysis drew heavily on his earlier interpretation of the late nineteenth-century Populist movement in The Age of Reform (1955). Combating the conventional understanding of this movement as an agrarian challenge to the industrial capitalist ascendancy of the time, he reasoned that the leading edge Populists were primarily acting out their roles as petty-bourgeois, or entrepreneurial, farmers. Far from being radical critics of capitalism, they were resentful of being dislodged from their primacy on the national scene, and were looking to better their position by mobilizing suspicion about the machinations of the business elites. His interpretation leaned on the paradigm of “status anxiety” favored by Cold War social scientists, and it prioritized a cultural, over an economistic, explanation of Populism that continues to strike a chord today in responses to the rise of Tea Party, and now Trumpism.

Yet the influence of Hofstader’s analysis served to downplay what was genuinely radical about the Populist farmers’ revolt against monopolistic capitalism along with their efforts to launch cooperativist alternatives. It also marginalized the evidence that plutocrats of the day did actually “conspire” (and still do) to promote their narrow class interests. In an era of more transparent public information, it has been easier to verify the suspicions, advanced by the 99 percenters of Occupy, and shared, for different reasons and in different versions by the Tea Party, about the cabal behind the bank bailout. While efforts have been made to portray both movements as marginal, illiberal rage-fests against the bankers’ ownership of the political class, Wall Street’s record of swindling, malfeasance, fraud and mendacity has been on full public parade for the last several years. Obama’s 2012 re-election simply deferred the reckoning, and, in some ways, ensured that it would take on a “populist” form. Even in a bourgeois democracy, where Congress is openly bought and paid for by wealthy donors, and where the rigged electoral system provides only a small window for popular expression, outcomes can still veer toward the unpredictable. And so it is that Beltway liberals and conservatives were caught unawares by the Sanders and Trump campaigns, both of which have sought to channel the popular disgust by rejecting the standard bi-partisan menu of free trade, austerity politics, and hands-off tolerance for the business of financial extraction.

That said, the surge of support for Trump is hardly a new alignment. Economically depressed whites have long identified with swaggering big shots who offer them a show of cross-class racial unity. Typically this invitation comes in the form of dog-whistle rhetoric, which is recognizable to, and appreciated by, those who are attuned to the euphemisms and insider intonations of white solidarity. Trump, of course, has ripped the camouflage off the rhetoric, and is openly racialist in his appeals. So, too, his personal wealth allows him to pour scorn on the donor-driven electoral system, again appealing to low-income conservatives for whom Republican policies have done very little but whose loyalties has been taken for granted by the party. His self-made personality cult is more atypical, but seems to be directed more at generating media attention than at building the proto-fascist base that some commentators have warned about. For sure, there are some commonalities with the right-wing anti-immigrant groupings in Europe: Golden Dawn in Greece, UKIP in the UK, Pegida in Germany, Party for Freedom in the Netherlands, National Front in France, the Freedom Party of Austria, True Finns, Sweden Democrats, Danish People's Party, the Flemish Interest, Lega Nord in Italy, Progress Party of Norway, and even those in power, like Jobbik in Hungary and Law and Justice in Poland. But these are all insurgent formations: Trump is operating within the cradle of a long-established mainstream national party, where his campaign is exploiting the contradictions thrown up by its rightward drift.

The Sanders initiative is fresher by far. Support for his unabashedly left-wing run draws its most enthusiastic allegiances from the young, but it has proven to be cross-generational and cross-class in a variety of states. He has picked up points for his personal integrity, his uncompromising focus on state provision of social goods like tuition-free higher education and universal healthcare, his straight talk about climate change, and his championing of high-road jobs that will not disappear overnight. Sanders’ affection for these cornerstones is often regarded as a throwback, yet the “middle class” he speaks of restoring is one that never existed, it has yet to be made. And it can hardly be sustained without engaging the voter segment that proved most resistant to Sanders–black Americans in the South. Their strong allegiance to the Clintons has been compared to the fealty of low-income Republicans, whose economic interests are routinely ill-served by the party’s policies. After all, Bill Clinton’s epochal bills on crime, in 1994, and welfare, in 1996, hit low-income African Americans the hardest, and were publicly supported and enabled by his wife. So, too Clinton’s black supporters in the South have been chided by Northern black intelligentsia for their “provincial” outlook, favoring politicians from the region or who, like Clinton herself, have spent more time there.

But these are not sufficient explanations, because they do not go the heart of the continuing legacy of the South’s unwritten racial order. It is no coincidence that the South was also the graveyard of nineteenth-century Populism. African Americans long labored under the charge that they somehow betrayed that movement which had sought to make common cause not just between agrarian and industrial labor, but also between black and white farmers. But these were not natural alliances. As labor leader Samuel Gompers pointed out, the farmers, unlike the urban factory workers, were mostly an employer class, and, as for the agrarian element, they were more likely, if they were white, to be employing black tenants and field hands. In any event, challenging elite power in the post-reconstruction Deep South meant going up against the violent order of the Bourbon Democrats, whose restoration to power was secured by crushing the black Populists by every means available: terror, voter fraud, bribery, racist propaganda, and everyday life intimidation. So, too, Southern whites were persuaded that a vote for the People’s Party was an act of racial treason, while white Populists who “needed” the black Southern vote were also perceived as opportunistic, even hypocritical, and not truly committed to cross-racial solidarity. Consequently, black support for Populism shrunk, and African Americans were rebuked, not for the last time, for “voting against their interests.” Yet the very real threat of violence had driven them back to the establishment parties, especially the Republicans, who had delivered Emancipation after all, and among whose ranks they had some standing.

On the face of it, the “populism” of Sanders’ 2016 campaign is also running aground on the shoal of Southern blacks. Once again, they appear to be voting for their established foothold within a party that is now tightly governed by the Clintonian New Democrat line, rather than throw down with an unfamiliar outlier. In a region where the Confederacy is still honored in a myriad of ways, this caution is hard-earned. So, too, the symbolism of a female presidency, following Obama’s pathbreaking occupancy of the White House, means more to populations denied representation and recognition in the upper ranks of public life. But arguably the more important lesson has to do with the communication of Sanders’ message about “restoring the middle class,” and it is not simply a question of tone. To African Americans ears, this appeal is directed primarily at downwardly mobile whites who have lost the gains delivered to them by postwar liberalism. Far from sharing that status, black Americans and other minorities were specifically excluded from the educational and homeowning opportunities created by the GI Bill and other programs (just as the life prospects of so many women were subsumed under the male breadwinner’s “family wage” that deeply underpinned the achievement of middle class status). The creation of a black middle class came late in the day, and children born into it are more likely to fall down the ladder than other groups. Moreover, unlike with white America, middle class is an identity that is publicly ascribed to a minority, and not to the majority, of African Americans. There is no expectation, in the public imagination, that this kind of socio-economic advancement–long considered a staple aspiration, if not a birthright, for whites-- will extend to most black Americans.

Even as it fades from prominence as the emblematic American lifestyle, the assertion of middle class identity remains as awkward as it has always been, and not just because of its middleness. Beneath the lipservice paid to most national unity ideals in the U.S. lies the ever-corrosive partitioning over race, which takes on new forms on a seemingly regular basis. As Malcolm X once put it, racism in the U.S. is “like a Cadillac, they come out with a new model every year.” The Black Lives Matter movement, which got its start just as the energies behind Occupy were self-dispersing, is only the most recent effort to mount an adequate response to the pervasive impact of white supremacy. Occupy’s foursquare challenge to financialization has worked its way into the political lexicon, raising issues like student debt (but not foreclosure) to the forefront of the presidential campaigns. By contrast, the impact of Black Lives Matter is still largely subterranean, and surfaces only when candidates are forced to take a rhetorical position on the routine police killings of unarmed black males, the soaring rates of minority incarceration, or their sharply eroding economic gains.

The black trauma and the white guilt surrounding these injustices are not routinely perceived as central to class politics, and yet they cannot be otherwise. Delivering material comforts along with a measure of existential security—the traditional hallmarks of middle class life-- is no substitute for what Robin Kelley called the “freedom dreams” of radical liberationists, for whom joining the “mainstream” of American society (the shorthand for achieving black middle class status) was once, and still, is a recipe for pacification, a milder form of incarceration. In that regard, the true spirit of abolitionism--eliminating prisons and state violence, dismantling the power of the creditocracy, dissolving the legacy of homophobia and sexism–lies in the future, not in restoring a compromised past. A politics of class that wants to look forward must embrace this spirit, and live by it.