Occupation Defines Class

When we look at any time period other than our own, we can easily identify a class structure - groups of people doing different kinds of work, enjoying different privileges and material conditions, that all fit together to form a whole society. We don’t naturally think of America in these terms, but class does exist in America.

If class is discussed, it is in terms of the 400 richest people vs the rest, or as three tiers to annual income. But class is about more than income. A plumber and a programmer may earn the same salary, but they belong to different classes. There are rich lawyers and poor lawyers, but they’re all members of the Bar Association.

Class is about how one makes a living - whether by time, mind, muscle, or ownership; in a bureaucracy, small organization, or freelance; whether it gives influence; whether it is dangerous - the countless unique features of one’s livelihood that influence one’s personal inclinations and political interests in broader society.

A class is also a culture. Your class is correlated with where you live, your educational attainment, the people you know, the pastimes you enjoy, where you vacation, the organizations you belong to, the media you consume, etc.

Seeing class clearly is not just an academic exercise, and it doesn’t require us to adopt any political principles. To excel in the world, we need to understand the landscape descriptively, not judgmentally. Class is an excellent lens for this, and it’s useful for marketing, managing a workforce, interacting with different kinds of people, understanding political economy, etc.

Local property owners own restaurants, real estate, roofing companies, dealerships - that kind of thing. A dealership owner might be rich and a restaurant owners could be struggling, but they both make money from their stake in their community. Their differently-sized boats are lifted by the same tide: the growth of sub-metropolis cities.

The professional class and the organization class are a bit difficult to distinguish. They’re both employees that receive high pay and/or status because of their education. The professional class includes the professions (doctors, lawyers, accountants) but also professors, teachers, journalists, and NGO people - generally people who advise, assist, research, or teach. The organization class (or the “professional managerial class”) tends to exercise more judgement in their work, but especially they work in larger, hierarchical organizations - especially tech, finance, and government agencies. Professionals have more professional autonomy and sometimes they own their own practice, but ultimately they’re earning by the hour.

Capitalists once ran their businesses, but now the intellectual work of management has been handed to the salaried, professionalized organization class. Even corporate boards are mostly stocked with the cream of the organization class crop. It is this class that now wields the powers of corporate America - to direct investment, to command the workforce, to shape daily life with their products and policies. But although managers control the corporations, they do not own them.

The owners of corporate America are the ultimate beneficiaries of its profit. Most Americans, the 53% that own stock, are beneficiaries to some extent. But I think that there is enough consolidation in stock market ownership (10% of investors own 84% of the stock market, probably lopsided towards the 1%) to say that there is still a class of “true capitalists”, major owners of multi-regional or multi-national corporations.

The heartland working class are your stereotypical exurban blue collar workers - “manufacturing, agriculture, energy, retail distribution, and warehousing”. For their low education, they have high wages but low status. The urban working class are low-skill urban workers - domestic help, food and retail, gig workers, etc. Finally, there is the “underclass”, people in a milieu of multi-generational poverty, government assistance, and crime. The underclass provides a humorous example of how the classes have different privileges, not just material conditions: homeless people are essentially permitted to defecate in public, but if someone dressed like a professional did that, they would be punished.

There are gradations to wealth within these classes, so I suggest we refer to a person’s class by combining their income bracket with their class. For example: A teacher is a lower-middle class professional; a restaurant owner may be a middle class local property owner; an oil rig man is an upper class heartland worker.

It is well established that there is a lot of income mobility in America, but class mobility? I’ve never seen a study on that. Despite coming from a privileged community, I see very little class mobility around me. The incomes and occupations change, but the class, the place in the system, does not. This may be an important secret about America.

These class coalitions are probably the most basic factions in American society. So the dynamics of these classes are likely the dominant currents in politics.

For one, there’s the waning power of the working class. For whatever reason, unions, churches, civic associations, and family units are in decline for all classes, but this particularly stresses the working classes that especially relied on these institutions for a safety net and for collective power. These people work in low-tech, low valued-added industries that grow along with America’s overall population and wealth, both of which are stagnating. This class competes with immigrants much more than the college educated classes do. The urban and heartland working classes have shared economic interests, but they’re divided along cultural and maybe ethnic lines. Because they don’t see themselves as a united class, and they have no influence, they’re best thought of as raw inputs or an inert mass.

The professional class is facing tough downward pressure. Professions that once secured business ownership now merely secure employment. Doctors were once business owners, now they’re most commonly employees of large companies like the rest of us. Meanwhile, the less secure professional classes - nurses, teachers, etc - are sliding into the urban working class, while retaining high status.

The most obvious cause is credential inflation. There’s been a huge push to make people go to college, and increasingly the professions offer the only good opportunities remaining. As everyone climbs into the professions, the boat starts to sink. This wouldn’t be a problem if the country were still growing. You could do the same as my grandfather - move to a town with only two doctors and do very well. But the only towns like that in America are dying, not growing.

There are various pressures on local business owners. This class has been particularly hurt by the events of 2020. Most large companies are robust to lockdowns that suffocate local businesses. Rioters destroy local businesses, only scratching the paint on large companies. The concentration of growth in the major cities is a larger headwind, though recent events may be relaxing this trend - a very healthy thing for the system, I think.

The most consequential pressure on local business owners are new national monopolies. At the turn of the twentieth century, local manufacturing businesses were out-competed by national monopolies achieving economies of scale from mass production and distribution. Today, the same process is occurring in retail and services. As software eats the world, it creates national monopolies where there were once local businesses, driving local business owners into laboring classes. Most (almost all) high value-added, high technology, and/or highly branded markets are naturally oligopolistic. Firms in these sorts of industries employ few workers compared to other firms of similar size. This is probably a natural and efficient arrangement, but it’s unhealthy for the system in the long term.

In general, local property owners are major republican donors and professionals are major democratic donors. Until Trump, the organization class had its interests represented by both Republicans and Democrats. Trump won by mobilizing the disengaged heartland working class in the Great Lakes, leaving the organization class out in the cold. Since then, this class has shifted left, along with true capitalists (the Waltons and Kochs shifted their donations from R to D from 2012-2016), and begun strictly enforcing ideological conformity.

These class dynamics are not the root causes of our situation in the US today, they’re consequences of declining growth and historical conditions. The root causes need to be addressed themselves. But a part of that reform must be re-brokering the relationships between the classes into a new, more productive structure - a process of creative destruction, with winners and losers.