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Salvo 01.05.2022 15 minutes

Class War is Just Beginning

Shopping trolley underwater

Seismic economic and demographic changes will feed division and conflict.

With the seeming deconstruction of the Biden Administration proceeding at a rapid clip, many on the right hope for an end to the conscious stoking of class resentments that has characterized progressive politics. Yet despite the political meltdown, America’s class divides have become so wide, and so bitter, that Biden’s presidency may prove more a prelude than a denouement for the future of class warfare.

Under both parties, American society, traditionally egalitarian, at least in theory, has become ever more divided by financial class. Today, the Federal Reserve demonstrates that the top one percent have more assets than the 60 percent who occupy the middle rungs. The remarkable rise of the tech oligarchy has paced this change, creating a gusher of wealth for the chosen few, including youthful, unproven start-up CEOs turned instant billionaires—as well as an unprecedented boom on Wall Street. The pandemic has accelerated this trend, vastly enriching the elites, and raising executive salaries to the highest ever. Meanwhile much of the working and middle classes may become increasingly dependent on what Marx called “the proletarian alms bag.”

In the process, the traditional ballast of American politics—a striving aspirational middle and working class—has been decimated. Our system rests on the notion of class mobility in both directions, without which everything devolves into a struggle over limited assets. Not surprising, notes Pew, most Americans are alienated from the political system. Roughly half of all Americans see capitalism as causing more harm than good, notes the recent Edelman trust survey, and a large majority fears being “left behind” economically. The prelude to autocracy and an expanded state, whether in twentieth century Europe or places like Chile today, rests upon alienation and a market that seems incapable of providing opportunities for the most families.

The new serfs

The biggest loser in early twenty first century America has been the working class. With the exception of wage gains made during the first three years of the Trump Administration, this class has seen its real income decline. Today, wages are rising again, but inflation is reducing real incomes, and leaving more Americans, particularly the poorest 50 percent, struggling to make ends meet. The pandemic lockdowns, whether justified or overwrought, have pummeled low-income workers and made more vulnerable those living in crowded housing.

Under lockdown the working class could not retreat, like the laptop class, to their computer screens. Barely 3 percent of low wage workers can telecommute versus 50 percent of those in the upper middle class. Workers at restaurants and shops have faced hard times, but professors and teachers continue to teach on-line, and senior bureaucrats remain on the job. And even when employed, observes the leftist journalist Glenn Greenwald, these workers, “the servant class,” remained masked while their charges, including at the recent Obama birthday celebration, cavort unmasked.

In our pandemic apartheid almost 40 percent of those Americans making under $40,000 a year lost their jobs in the first few months. Some 44 percent of Black households and 61 percent of Latino household, notes Pew, during the first year of the pandemic suffered a job loss or pay cut, compared to 38 percent of whites. “Lockdown fanatics,” thunders the widely circulated “labor populist” blog The Bellows, “have helped manufacture consent for a brutal reorganization of labor that will plunge millions of people into serfdom.“

Will the serfs rebel?

Where will the serfs go politically? They do not have a sympathetic audience among the progressive gentry. A writer at The New Republic  has  called for “blue states and cities to effectively abandon the American national enterprise,” dismissing the rest of the country as “crazy, deadbeat in-laws.” Calling people “deplorables” or “clingers” may well be part of the reason that working people, including many minorities, have shifted to the GOP. Salon recently published a piece that applauds the tendency among young progressives to ostracize and avoid contact with Trump supporters, not just politically but in daily life.

Progressive author Joan Williams has accused the national elites of “class cluelessness,” which leaves them vulnerable to authoritarian solutions. “If we don’t take steps to bridge the class culture gap, when Trump proves unable to bring steel back to Youngstown, Ohio, the consequences could turn dangerous,” Williams avers. What the working class wants, she suggested in a recent episode of Salon Talks, is not more welfare and transfers, as Biden has proposed, but “respect and solid middle-class jobs.”

But don’t count the working class out. The pandemic revealed how those of us in the laptop class depend on the efforts of people who work in restaurants, factories, and warehouses, who drive delivery trucks, and care for the sick. This class now appears to be gaining some consciousness of their real worth, as illustrated by the “Great Resignation,” workers deserting the workplace, and demanding more money for their labor. A wave of strikes has hit industrial firms but also “new economy” companies like Starbucks and Amazon, which has a history of labor abuses, as well as progressive icons like the New York Times and inside academia, where woke politics conflict with the realities of a bifurcated labor market between tenured faculty and low-paid teaching assistants.

The deep labor shortages, particularly evident in industry, will not go away even when the pandemic fades. Its roots lie in demographics, with low labor force growth and a sinking birthrate. There’s also a growing sense that work does not pay off among younger people, driving quit rates, notes Challenger and Grey, to record levels. Labor strife, in other words, could just be beginning.

The embattled yeomanry

The working class may have suffered the most in the past decades, but the angriest class in America may be the small business and property-owning class that long stood as a critical part of our national ethos. These are now widely castigated by the intellectual classes for their tendency towards Trumpism.

In recent decades, the shift to the digital economy and the consolidation of financial power has undermined the yeomanry’s position. National chains and online services are replacing many traditional Main Street businesses—the insurance and travel agencies, the local banks, the High Street retailers and restauranteurs. To make matters worse, local smallholders increasingly find themselves dependent on what analyst Mike Lind calls “toll booth” companies like Facebook, Google, and Amazon, tech megaliths which are able to coerce small businesses to give up their data. Amidst the supply chain crisis, firms like Amazon and the big box stores use their bargaining power to minimize delays in deliveries in ways not available to smaller businesses.

The traditional yeomanry—like the “kulaks” or wealthy peasants in Stalin’s day—is losing out. As executive compensation reached the stratosphere at the big tech and finance firms, small businesses faced what Harvard Business Review described as “an existential threat.” Experts are warning that one-third of small businesses, which comprise the majority of U.S. companies and employ nearly 50 percent of all workers, could ultimately shut down for good. Hundreds of thousands have already disappeared, including nearly half of all black-owned businesses.

The end of the pandemic may not alter the new class structure. Green activists see in the lockdowns a model for their preferred strategy of saving the planet by immiserating the middle class, even though climate change is named as the country’s biggest problem by a tiny 4 percent. The new model, under the rubric of “the great reset,” seeks to embrace degrowth, based on downsizing of aspirations of the striving masses. In the emerging schema, the average American must get out of their cars, travel far less (as the oligarchs increase their own GHG-spewing private jet use), eat bugs, and live in tiny apartments.

Many younger people are doing far worse than their parents, according to researchers at the Equality of Opportunity Project. Certainly, notes one recent survey, they have lost faith with Biden, a turnaround of 40 points in less than a year. Federal Reserve Bank of St. Louis, of becoming a “lost generation” that, even among the moderately successful, will likely never own property, start a significant business , or achieve middle class status. Rather than the “snowflakes” so caricatured by the right, they could become an angry, resentful constituency who could become socialist or, as some suggest, be more motivated by family concerns to move towards the anti-establishment right.

The oligarchs versus the clerisy

The biggest conflict, at least over the remaining years of the Biden Presidency, may be within the progressive coalition. In the run up to the 2020 election the alliance between the clerisy—academia, media, upper bureaucracy, the green non-profits, the diversity industry—and the increasingly Democratic corporate elite held together, with Donald Trump providing the glue. With the potential fading of Trump’s toxic touch, this coalition could break. The oligarchs, despite their constant virtue signaling, are still profit-driven, with a keen eye for monopoly, in ways that many in the clerisy find objectionable. Academics, particularly with tenure, or people will trust funds can celebrate “de-growth” and drastic energy cutbacks; oligarchs need lots of electricity to run their devices, not to mention the electric cars they see as key to their industrial ascendency.

Then there is the question of the concentration of wealth. Intelligent leftists (largely outside the mainstream media) recognize that gentry liberals like Nancy Pelosi are not levelers. She has defended stock trading by members of congress, made sure capital gains rates on the very rich were not raised much, called a wealth tax “a publicity stunt,” and pushed for a higher level for write-offs on local taxes, which could mean a lot to the wealthy Democrats funders in Silicon Valley or Manhattan.

Will all hell break loose?

Until now, the left, aching to get its dream of a giant, permanent nanny state, has swallowed the gentry agenda. But if Biden’s BBB program never passes or is severely truncated, the knives will be out for moderate Democrats. Expect more “blue on blue” conflict as the class interests of the oligarchy—tech firms have become increasingly unpopular among the public—conflict not only with the left, but all other classes.

Most national media attention this year will be on the battle for control of Congress. But the most interesting battles may take place well before November. This includes some school board elections, where the progressive left’s attempt takeover of education has produced a fierce backlash, even in San Francisco, in addition to the bitter loss in Virginia. There are also  efforts, as in San Francisco and Los Angeles, to remove criminal-friendly District Attorneys; even Seattle has removed its version this year, so anything is possible.

The internal battle for political power could become ferocious, as both parties are deeply divided. Among Democrats, disappointment with Biden could spark a growing primary wave pitching leftists of the AOC mold, who at least embrace the idea of a better deal for the working class and are stronger against China, against more established candidates closer to Wall Street.

It may become more difficult for Pelosi-style Democrats to silence progressives over their economic “privilege.” Some now call for “a global ban on billionaires,” while pressure to impose wealth taxes on unrealized capital gains is growing both nationally and in particular states. A return to the party’s tradition of middle of the road populism—what one strategist describes as “Common Sense, Heartland Democratic”—could represent a strategic masterstroke but seems unlikely given the predilections and geographic concentration of the party’s dominant corporatist and woke wings.

Republicans too will experience something of a class-based conflict, with the pro-Trump yeomanry in conflict with not only the oligarchs and the progressives, but remnants of the GOP’s old corporate, neoliberal wing. Though a populist shift may be welcome, particularly among the roughly half-million, mostly very small firms started since the pandemic, there are moves afoot to curb their ambitions, including new regulatory burdens and much higher tax increases on small, privately-owned firms, precisely the kind of businesses that seem to have less clout in Washington.

But sustained anger in the middle and lower classes could also lead, as has occurred in Europe, truly awful nativist and even racist elements into their coalition, something as destructive as the progressive drive to deconstruct the country. A country divided between socialist agitation and resentful yeomanry will not be pleasant. If we do not confront the realities of our class divides, anger on both sides will continue to build, intensifying our current, increasingly uncivil civil war.

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