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Retreat of the elites

Both liberals and conservatives rail against the insularity of the one per cent


 
Retreat of the elites

Brian Cahn/Zuma Press/Keystone Press

A short polemical book by a cable talk-show host doesn’t usually set off a worldwide conversation about the way society is organized, but Chris Hayes, the bespectacled policy wonk who hosts MSNBC’s Up With Chris Hayes, hopes to do just that with Twilight of the Elites: America After Meritocracy. Lots of people claim to hate elites, usually as a partisan excuse to beat up on political opponents. But with this year’s U.S. election cycle, there’s a twist. This time, it’s more than just hot air; politicians and pundits alike are dead serious about the issue. Massachusetts Senate candidate Elizabeth Warren has built a campaign on telling Americans that “nobody got rich on their own,” and some conservative commentators are taking on elites in ways that go beyond what Hayes calls “people who listen to NPR, drive Priuses and live in San Francisco.” Jonathan Rauch, a guest scholar at the Brookings Institution, says that both liberals and conservatives seem to be disturbed by “the rise of an insular elite,” people who “might as well be in a different country, and often live and think as if they were.”

This frustration with elites may be stronger than at any time since the ’60s when, Hayes says, “we had a whole national conversation about the crisis of authority.” Pundits are increasingly trying to grapple with the implications of living with, as Rauch puts it, “a class divide which perpetuates itself across generations.” Conservative hero Charles Murray recently published Coming Apart: The State of White America, where he argues that society is in trouble partly because the upper-class elite is “hollow at its core,” unwilling to connect with non-elites and set a good example. To Hayes, the meritocratic system has been just as bad for social mobility and equality as the old hereditary class systems.

No one seems to know how to deal with the problem, Rauch says, “but it’s important that a liberal worried about equality and a conservative worried about civil society are both worried.” Even David Brooks, the conservative New York Times columnist whom Hayes describes as “the most prominent defender of the institutionalist outlook,” admitted that Hayes has a point about meritocracy’s poor track record: “As this meritocratic elite has taken over institutions,” he wrote, “trust in them has plummeted.”

There’s nothing new, of course, about arguing that the people at the top aren’t doing a good job of running things. What’s new is that some of these new anti-elitists are turning the knife on their own readers or even themselves, challenging the institutions they support or even belong to. Hayes spends a chunk of Twilight of the Elites talking about the tendency of Hunter College High School, the meritocratic public school he attended, to reinforce the inequities in U.S. society (in part because rich kids can afford better test preparation). This didn’t go over with some smart, affluent liberals, who responded that they were being personally attacked for being smart and going to good schools. Rauch says conservatives and liberals have to face the fact that “society is splitting and neither the market nor the government seems capable of stopping it, so it’s hard for anyone to feel smug or happy.”

The new anti-elitists may not agree on a solution, but they do seem to be disenchanted with the old idea that education is the answer, or that inequality is all right if the smartest people rise to the top. Hayes calls this a dangerous “cult of smartness.” Aaron Swartz, a computer programmer and activist who has been prominent in the online backlash against elite institutions (he was arrested in 2011 for allegedly “liberating” millions of academic articles from a database), says that “when you create situations where there can be only one winner, you’re inherently putting people in a situation where to succeed, others have to fail.” Hayes says we should be moving toward a social model where instead of giving rewards only to the best and brightest, “every job pays well enough to have a modicum of comfort, that there are many fulfilling lives to be had,” and where the upper class don’t lead completely separate lives from the rest of us.

Was there ever a model that worked that way? Hayes thinks there was, and so do a lot of anti-elitists. Hayes argues that shared prosperity, and a comfortable existence even for non-elites, was part of “the broad political-economic system that was in place from the New Deal until the early ’70s,” when taxes on the rich were higher and unions were stronger. Since then, says University of Ottawa professor Miles Corak, people have had an increasing sense “that there has been a cultural change in the degree of inequality that is socially acceptable among the elite.” And many commentators across the political spectrum have noted that elites used to be less cut off from everyday life than they are now. Murray spends portions of Coming Apart castigating elites for being out of touch with regular people, and told the New York Times he moved his family to a rural area because “I did not want my children to grow up only knowing other upper-middle-class kids like themselves.” No matter what kind of anti-elitist you are, it seems, you’re looking back to a time when there was more social connection between the rich and the middle class.

That argument has a whiff of nostalgia to it, and that may be the most unexpected effect of the new anti-elitism: it has many people longing for the Mad Men era. Conservatives like Murray argue that the ’50s was a time of stronger values, but so do liberals like Paul Krugman, who writes nostalgically about that period, considering it a “paradise lost” of economic equality and strong unions.

The longing for the good old days became particularly potent in July, when a 1955 Fortune magazine article unexpectedly went viral online. It was an article about what Hayes describes as “the relatively modest life of an executive in the ’50s.” The piece described how the era’s high income taxes forced high-powered executives to do without servants and mansions, and filled commentators with a sense of longing for an era when class divides were not so stark. For Hayes, there’s more to this kind of longing than pure nostalgia; it’s also a reminder that social policy can change the behaviour of elites, creating what he calls “a cultural norm that was accepted among the executives of the time.” He points to the differences between Mitt Romney and his father George, both of whom were part of the wealthiest one per cent. George, a favourite of liberals who miss the old-fashioned moderate conservatives, accepted the idea that rich people should pay higher taxes and live relatively modest lives. That history gives Hayes and other anti-elitists a sense that it’s not hopeless, that society can be made more equal if we put the right tax policies into place. “A regime of high top marginal tax rates that squeezes together the top and the bottom is a good first step toward solving the problem,” he says.

Of course, if anti-elitist, anti-meritocracy views inevitably lead to higher taxes, that could explain why there’s been so much push back by some elites. Many bankers have been bitterly resentful of the idea that luck, rather than merit, played a role in their success: there’s been a ferocious backlash against President Barack Obama for saying that businessmen don’t succeed on their own, and Hayes says that JPMorgan Chase chairman Jamie Dimon thinks “basically that people are ungrateful and fail to recognize how hard-working the elites are.” Others have expressed the fear that the new wave of anti-elitism could overturn the system and replace it with something worse: real estate billionaire Jeff Greene warned New York magazine, “We will build a class of poor people that will take over this country, and the country will not look like what it does today. It will be a different economy—rights, all that stuff will be different.”

Of course, such fears might be overblown, in part because most of the people talking about overthrowing the elites are, at the moment, elites themselves. “What could be more open-minded,” sneered Lisa Mogilanski, a Fortune contributor who went to the same high school as Hayes, “than vilifying, as Hayes does, the very system that conferred elite status on you in the first place?” Hayes admits he’s “implicated” in the system he criticizes, and he also can’t go so far as to argue against elitism and meritocracy within a corporate structure. “Anyone who’s ever worked for an institution understands that people have different skills,” he says. “So I’m not saying that we should be selecting surgeons’ licenses by lottery.” Or, for that matter, pundits.


 

Retreat of the elites

  1. You can’t start this discussion without acknowledging that “elites” in government are a significant, if not the most significant aspect of this problem. I can’t give a damn about how much someone makes in the private sector. You have to earn your keep out in the real world. But, when some 3% of federal public workers earn in the top 1%, and 15% of Ontario public employees are in the top 5%, you have a serious problem on your hands. It is these people who have become a class unto themselves, often answerable to few others and uniquely able to fly under the radar of scrutiny (Allaudin Merali, anyone?). They rarely have any private sector experience (meaning real expertise), they rarely hold positions that are transparently commensurate with the salary of the position (i.e. “accounting consultant”. Just what can an accounting consultant do for us, exactly?), their bio’s routinely demonstrate an aversion to risk, yet they are being rewarded in a fashion usually reserved for those people who successfully take on the risk associated with operating extremely successful small businesses with several dozen employees, or the generation of millions of dollars in sales and profits at larger private sector companies (a construction equipment salesman would have to sell somewhere in the neighborhood of $30-40M in equipment at strong margins to earn $250K annually.)
    The problem is that we lowly taxpayers are increasingly burdened by governments that reward themselves far too richly, and are increasingly populated with an “uber-class” of exceedingly well paid bureaucrats who truly consider themselves our moral and intellectual betters. We can’t afford that.

    • Well you’re just talking about govt employees, and they aren’t elites by any means. It seems to be mostly partisan on your part or envy. but they aren’t a problem.

      And I don’t know where you get the idea that civil servants or bureaucrats ‘consider themselves our moral and intellectual betters.’

      • Well, Em, they are a problem. In the private sector, we all have an “out”. If the price of something is too high, the buyer can opt out of the transaction. If the offered price isd too low, the seller can opt out. Yet, we lowly taxpayers don’t have that option when dealing with govt. There legions of 250K/yr govt. employees who would be hard pressed to be earning 150K or less for comparable jobs in the private realm. This drives up the cost of government immensely. Remember, many of the salaries offered to public sector executives have little to do with job performance, but merely the “size” of the operation they’re in charge of. Unfortunately, this is often expressed as the cumulative payroll of the organization, which leads to an escalating cost spiral.
        For all the excesses found in the boardrooms of large corporations which only accounts for a tiny fraction of the real world, the reality is that private sector pay is always predicated on the ability of an individual to be profitable to the company. In that fashion, no one should ever look at govt. as a “career”. Every level of government should always be less lucrative than the private sector. Govt. should always be considered temporary employment, especially for people at upper levels of administration.
        Going back to individuals such as Merali, what savings was he expected to deliver to government? Anything less than $5-10 million, and he was a waste of money. Secondly, govt’s are generally buyers, not sellers. Why was he needing to buy so many expensive lunches, etc?
        His behavior was symptomatic of the widespread view within government that the work they are doing is so important and so valuable, that cost is little object. They have immersed themselves in the belief that they are simply worth the kinds of money that are mostly unheard of in the private sector, and they very much do look down their noses at we lowly taxpayers.
        (See: Allison Redford, Dalton McGuinty, et al.)

        • I don’t know where this idea comes from that we have unqualified govt employees….partisanship perhaps….The private sector often has far higher pay than govt work so our govt has to offer comparable salaries in order to keep people. Plus govt work often needs unique skill sets, and has to pay accordingly.

          And I have no idea why you’d want a bunch of temps in there handling important national business!

          In any case, they aren’t elites, and everybody pays taxes.

          I have no idea what Redford or McGuinty have to do with it. They are elected officials.

          • It’s not necessarily that they’re unqualified, it’s that they’ve spent so little time in the real world that they have no idea that the job they’re getting paid $250K for is actually a $150K job. Or, the $100K govt. job only pays 65 out here.
            But, there are routinely upper-echelon govt. jobs that are filled by careerists, that could be filled by highly skilled and qualified members of the private sector who are transitioning from business leadership to retirement (i.e Gwyn Morgan) for considerably less money. The problem is that the left-leaning rank and file of the public sector wants anything but someone who has built a multi-million dollar company overseeing public operations. They are also repelled by anyone who is not uber-PC, which rules out real leaders and thinkers.
            My small city is home to a number of individuals who could make many govt. operations leaner and better at providing actual customer service. They would do it at a cut rate, and for a few years only. But, they would accomplish more than most of the career losers that govt. normally attracts can. Think of it as an executive-class Corps of Canadians.
            The public sector workers, even at the upper end, see govt. more as a provider of jobs than a provider of services.
            Redford and McGuinty embody the idea of a ruling class of elites who are wholly incapable of grasping the concept of actual, limited government. They are among the very elitists who are the core of our nations most pressing problems.

          • We ALL live in the real world Bill…..they buy clothes and groceries and homes like everyone else……and I have no idea why you think you can set a career salary better than the people actually involved.

            They have specific educations, and requirements…..they aren’t people you can just pick up off the street…..or expect some businessman to take up as a hobby. The public service is neither left nor right….it’s a long standing tradition, once an absolute requirement.

            What you’ve now just said is partisan…..and envious.

            And nothing to do with the topic

          • But, Em, you can’t escape the hard fact that legions of them just aren’t that bright. I could set out tomorrow, and in less time than it takes to find 20 senior government employees (in the $150K+ category) who actually understand that governments can’t continue to expand at double the rate of growth in the economy, I’ll find you a half-dozen mating pairs of Bigfoot. That, my friend, makes those people just plain dumb, and governments are chock-a-block full of those kinds of people.

          • This is just one long class-envy whine on your part

            As in ‘hey I think I’m smarter than those guys, so I should have their jobs…..or at least their money’

            In the end, left and right wing are the very same…..’make the rich pay’ or ‘punish anyone who has more than I do, because they can’t have gotten it honestly.’

            Just envy.

          • What utter nonsense. The City of Ottawa tried using a Private Sector Guru for a mayor in the name of Larry O’Brien, which turned out to be an unmitigated disaster. If that’s what you are proposing it won’t work. And to target Government employees is just too easy. How about the real elites in the private sector? What have they done? Especially in the United States, they’ve comandeered Congress, and reduced their own taxes, done nothing to help the middle class, and become so insular you’d think they were in the middle ages living large in their great halls while the poor remains starving outside the walls.

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