The middle class is becoming increasingly proletarian. So argues Joel Kotkin in his latest piece for New Geography. Kotkin highlights some increasingly familiar statistics about the stagnating economic prospects of the working class and then points out that both parties are helpless in the face of this trend. The contemporary left doesn’t have an answer. Its policies restrict growth or create a permanent underclass “living hand to mouth.” But the democratic capitalist rhetoric of the right, Kotkin argues, is also problematic. Wealth, especially stock ownership, is becoming more concentrated, and poverty is spreading. But Kotkin believes there is a way forward:
The early decades of the Industrial Revolution saw a similar societal decline, as once independent artisans and farmers became fodder for the factory lines. Divorce and drunkenness grew as religious attendance failed. But a pattern of reform, in Britain, America and even Germany, helped restore labor’s place in the economy, and rapid growth provided the basis not only for the expansion of the middle class, but remarkably improvements in its well-being.A pro-growth program today could take several forms that defy the narrow logic of both left and right. We can encourage the growth of high-wage, blue-collar industries such as construction, energy and manufacturing. We can also reform taxes so that the burdens fall less on employers and employees, as opposed to those who simply profit from asset inflation. And rather than impose huge tuitions on students who might not finish with a degree that offers employment opportunities, let’s place new emphasis on practical skills training for both the new generation and those being left behind in this “recovery.”
This is exactly right. The parallels between our age and the industrial revolution are huge and important. But both parties seem to be overlooking them. This failure of historical imagination is in some ways indicative of a larger failure in the way we educate our elites. But more importantly, it means we will have to look outside the left-right policy consensus to find new solutions. We are living in an era of profound flux, and the changes will speed up before they slow down. The best thing we can do in the meantime is to take full advantage of federalism, encouraging states and cities to conduct the bold experiments that will show us the way forward. Read the whole thing.