The Cold War may have ended, but the class war rages on—or so Michael Lind argues in The New Class War: Saving Democracy from the Managerial Elite. TAI assistant editor Aaron Sibarium recently sat down with Lind to discuss this argument, and what it means for democracy in our populist era. This is a lightly edited transcript of the conversation.
Aaron Sibarium for TAI: You have a new book out: The New Class War: Saving Democracy from the Managerial Elite. What is the new class war?
Michael Lind: It’s the conflict that has broken out between the college-credentialed, university-educated managerial and professional class, which dominates Western democracies on both sides of the Atlantic, and the high school-educated working class of all races and national origins, which is about two-thirds of the population. I argue that there was a kind of class peace treaty, or what political scientists call a “settlement,” between capitalists, managers, and the working class for a couple of decades following 1945 that broke down in the late 20th century, largely as a result of the atrophy of the institutions that had amplified the power of less educated working-class people. The most important of these were trade unions, churches, and other religious organizations, as well as local mass membership parties—parties of political machines at the local level.
As a result of that breakdown, there’s just been a shift of power and influence in all three realms: the economy, the culture, and government. And I argue the frustration this has created on behalf of much of the population has ultimately led to a lot of the populist rebellions we’re seeing: the election of Trump, the Brexit vote in Europe, the Yellow Vest revolts in France.
AS: Part of the story here is the rise of a “managerial elite,” as you call it, which differs in important ways from the elite it displaced. What are the distinct features of this managerial class?
ML: I don’t claim any particular originality here. I follow James Burnham, a one-time influential American Trotskyist who became one of the founders of postwar American conservatism. In his book The Managerial Revolution written during World War II, he argued that the Marxists were wrong. The two major classes in the Western world in the 1940s were not workers and capitalists, but workers and managers. Because at that point, thanks to the rise of large corporations, there was what Berle and Means in their classic study of the corporation described as separation of ownership and control. And you had this bureaucratic corporate executive class who were not necessarily the biggest shareholders. Particularly nowadays when shared ownership is widely dispersed and fluctuating, it’s kind of a legal fiction to say that the shareholders are the owners of the corporation, and that the managers are merely passive agents.
So that was the argument. Burnham argued—and I follow him—that the managerial elite includes far more than corporate executives. It includes professionals, experts of all kinds, civil servants, and also the military, which he argued would become increasingly influential in societies. Meanwhile, only one-third of the working class was ever industrial workers—the rest were service and clerical workers. But at present, as a result of automation and productivity growth, most new working class jobs are in hospitality and leisure, healthcare and retail. And those tend to be very poorly paid and very non-union jobs. So the migration of employment from the unionized manufacturing sector to these sectors has contributed to inequality.
AS: A common libertarian argument holds that if you look at the data, working-class living standards have improved, so everything’s more or less fine. To the extent there is a crisis, it’s one more of perception than fact. How do you respond to this argument?
ML: Well, it’s true: As a result of technological progress poor people have access to all kinds of technology that rich people did not have a century ago. The problem with libertarians is they’re like Marxists, and even some progressives: They think money is everything. They ignore power. They ignore dignity. So the basic premise is, “well, you’ve lost your unions, which amplified your influence if you only had a high school diploma, but in return you make $500 more a year, so it’s a wash.”
I find it very odd because the whole basis of American republicanism, small-r republicanism, is the idea that ordinary people should have power and that there should be checks and balances. The idea is not that you can have a dictatorship or an autocracy or an aristocracy as long as it pays compensation to everyone else.
AS: Here at the magazine, we’re very interested in reviving what we call the political center. In the book you note that the center of elite opinion is very different from the center of working-class opinion—even as your emphasis on class compromise sounds, well, kind of centrist. Do you identify as a centrist? And what do you think are the biggest mistakes that self-styled centrists have made?
ML: Marx said, “I’m not a Marxist,” so I like saying that I, Michael Lind, am not a Lindist. I’m less interested in sticking out a position on the political spectrum—either the elite spectrum or the working-class spectrum, which are your two different political spectrums—than I am in nation-building. And how do you rebuild a functioning democratic nation-state in which politics is not all about 51 percent trying to annihilate 49 percent? I think we have to be as inclusive as possible. In the book, I call this “democratic pluralism,” the idea being that you have to have a government based on compromise.
But before you can have compromise, you have to acknowledge the reality of conflict. You have to admit that the conflicts are legitimate. Because if one side is simply wrong or one side is simply evil, then there’s no point in compromise. So democratic pluralism is a very realistic view of politics. It’s arguably the case that employers and employees have clashing interests on things like trade and immigration. There is no one objective policy, so you have to negotiate and make trade-offs. Different religious groups and secular people have equally legitimate values. They have to coexist in the same society.
And when it comes to matters of class, the vast majority of working-class people simply are going to be outweighed in politics and in the media by the minority of very well-educated and very well-financed people. So they have to have their own organizations to exercise what the economist John Kenneth Galbraith called “countervailing power.” But my vision is one of compromise and negotiation. It’s not that a group of experts gets together and decides what the ideal policy is and then the government just imposes this. I don’t know in advance what the ideal policy is for Uber and Lyft drivers. I think that the drivers should have some kind of collective representation and should be able to negotiate with their employers. But if they can come up with a solution that’s acceptable to both, that’s fine with me.
AS: You say that under democratic pluralism, the state serves as a kind of brokering agent between labor and capital. Could you elaborate on the role of the state in this negotiating structure?
ML: The libertarian or classical liberal view of government is that it’s an umpire. It doesn’t have any commitment to one side or another, or even to one country or another, according to libertarianism; it just enforces the rules. Whoever wins, wins. But the democratic pluralist tradition sees the democratic nation-state as the coach of a team. And the team includes the national managerial elite and investors and workers, who are all competing with other nations. So democratic pluralism involves some degree of economic nationalism.
It’s not necessarily leading to war or anything like that. It’s just that all the different countries are trying to make their own people more prosperous. And so as a result of that, the government can step in and keep the different groups in society from ripping each other apart. But at the same time it should not just try to dictate things from above. So that’s why I think the coach metaphor is better than the umpire metaphor.
AS: Would you say that this more thoroughgoing concept of democratic representation is just a means to class compromise, or is it a normative end in itself?
ML: I think it’s a means to an end. The normative end is national unity. And that’s why, even though some of this sounds vaguely Marxist, the premise is not that the working class is going to destroy and replace the managerial class. Every society, including communist societies, have had managerial elites in the modern world. And you have to have them. You have to have experts. You have to have managers. And in practice, they will probably pass on their advantages to their children to some degree. You even see this in communist industrial countries. So the goal is to give the working-class majority the weapons to enforce a compromise, to draw some concessions from the managerial elite.
If the working class were too strong and were threatening to cripple the managerial elite, I would be for strengthening the managers against an overly powerful working class. But the goal is national unity. It’s what Henry Carey, the Whig economist in the 19th century who was an advisor to Abraham Lincoln, called “the harmony of interests.” And there’s this older Hamiltonian tradition that rejected the Jeffersonian and Jacksonian idea that there’s a battle to the death between capital and labor in favor of the idea that they’re partners in a common project of national development and national construction. But the government is not simply a passive figure. It’s actively bringing them together and regulating their partnership.
AS: You write that under democratic pluralism, “legislatures can cede large areas of policymaking to those with higher stakes and expertise.” That framing sounds a bit like some defenses of the administrative state, of which you are a partial critic. What role, if any, do administrative agencies have in brokering class compromise?
ML: There have been two kinds of administrative agencies that are somewhat independent of direct presidential political control since the progressive era. One kind is the very technocratic agency where you get the experts who are insulated, they’re altruistic, they’re wise, they have degrees from Ivy League universities. And whatever they want is supposedly good for the public. I’m very suspicious of this for obvious reasons. The other kind is associated with a lot of the New Deal agencies that were created. And we have to remember the New Deal was a farmer-labor alliance. It was an alliance of the working class and the family farmers who had been excluded from the first stage of industrialization in the United States. They realized that Congress cannot possibly make detailed regulations for everything in an industrial economy, but at the same time they did not want to turn over vast discretionary power to a bunch of “pointy heads,” as George Wallace would say, from the Ivy League universities.
So their compromise was to create sector-specific organizations: the FCC, the Agriculture Department, and various independent agencies where interest groups were represented and could influence policy, even if only informally. Now, libertarians hate this because they see it as corruption for the interest groups to influence policy. A certain kind of technocratic progressive hates it because the people who make policy are not supposed to actually be from that field—that’s their definition of corruption. But to my mind it makes sense, because if you’re going to make policy for family farmers, you should probably talk to family farmers. If you’re going to make policy for taxi drivers, then represent the taxi drivers and consult with them.
By the same token, I think we have a very unrealistic view of the omnicompetent legislator. We have this idea that if you’re a Senator, today you’re going to make policy for farming and tomorrow you’re going to make it for pilots, and the day after that you’re going to make it for religious liberty. Having worked in state legislatures, I can tell you that doesn’t happen. What happens is that one or two members of the legislature are known as experts in a particular field. Usually they have some connection with that field, and their fellow legislators—often across party lines—defer to their expertise. So one of the things I argue is that we should not be afraid to delegate some policymaking authority to administrative agencies, on the condition that they represent interest groups, particularly working-class interest groups, whose views might be ignored otherwise.
AS: How much of the current working-class ferment is due to a feeling of powerlessness, and how much of it is due to the people in power making bad decisions? Put another way, if elites had taken better care of the working class without actually giving them much substantive representation, would the working class still be in revolt? To what extent is this about powerlessness qua powerlessness versus not getting some preferred policy outcome?
ML: I think you can make that distinction in theory. But in practice, you really can’t, because unless there are institutions that represent the policy preferences of working-class people, those people are going to be ignored.
So in theory, yes, you could have had a bipartisan consensus that did not push elite-friendly globalization policies, that did not push elite-friendly immigration policies, that did not push elite-friendly environmental policies such as in France. But there’s a reason why the elite-friendly policies always prevailed: the absence of actual checks and balances. So I simply don’t believe in the possibility of a benevolent elite unless members of the working class have something beyond the vote. The vote is important, but casting a vote every couple of years for one of two candidates—particularly when both have been chosen by donors and elite activists—does not give you very much influence on the system. That’s why, I think, you have to have free elections, but they have to be supplemented by policymaking bodies where you have additional checks and balances.
AS: You write that “even in so-called capitalist countries,” partly as a result of this lack of checks and balances, property rights have been “diluted and redefined beyond recognition.” How has this happened, and what are the implications for the struggle you’re describing?
ML: This gets into why I don’t like the term “middle class.” For the majority of people in the United States, I use the term “working class.” The classic word for that is “proletarian,” which sounds kind of Marxist, but it comes from ancient Rome. It meant a propertyless wage worker, who has to earn a living by working for wages. Today we talk about the home-owning majority, the property-owning majority, and so on. But in practice, unless you have paid off your house mortgage loan completely, you’re renting it from the bank. And the same is true of your car—you’re renting that until it’s completely paid off, if it ever is. So the property-owning majority is kind of an illusion.
And I’m not criticizing the system. It’s a successful system. But let’s not trick ourselves into thinking that most Americans are therefore property-owners in a significant sense, or certainly that they’re capitalists. The vast majority of Americans in retirement depend almost entirely on Social Security. Only the top half of the population has any kind of investments in 401(k)s or IRAs. And even that, if you look at the average 401K or IRA, is really a negligible amount of money. It doesn’t last very long. So we really have a majority of people who could not live for more than a few weeks without a wage, without turning to the state for unemployment insurance. They would be destitute in old age without Social Security. And this is one of the reasons that there’s a class division in attitudes toward entitlement policy. It seems insane, if you think about it, that after the economy crashed in 2008, the priority in Britain was austerity, cutting back government spending in the middle of a global depression. And in the United States, we had the bipartisan effort to cut the deficit, with President Obama offering the Republicans a cut to Social Security. That would not have happened in a truly democratic system in which ordinary people had the same clout as very well-to-do people.
AS: Implicit here is a critique of a certain kind of left-producerism, which folks like Elizabeth Warren and Matt Stoller have been pushing. That tradition imagines a world where all Americans are self-reliant property-owners, and hearkens back to the free labor movement of the 19th century. You seem to be saying this is a pipe dream.
ML: My previous book, which I co-authored with the economist Robert D. Atkinson, was Big Is Beautiful: Debunking the Myth of Small Business. And we criticize this anachronistic, 19th-century Jeffersonian idea of the small producer. It’s just completely anachronistic. A slight majority of Americans today work for firms with 500 people or more. I love that statistic. It just shocks people.
Small businesses create most new jobs. They also destroy most new jobs because almost all small businesses fail. So the only net job creation is by successful businesses, which if they are successful, become medium-size or large businesses. They level off at some point, of course. But that being the case, this Jeffersonian ideal is a hundred years out of date. It was clear in the early 20th century that you could do four things to respond to the rise of large corporations. One is to break them up into little teeny-weeny firms again, mom and pop firms. That’s the anti-trust agenda. That was considered anachronistic even in World War I—Woodrow Wilson said, “this is absurd.” So did Theodore Roosevelt. Roosevelt has this reputation as a trust buster, but if you actually read what he wrote, he thought consolidation was inevitable.
So we have these large corporations, and they should be regulated. But if you reject breaking them up into little pieces, what are the remaining three options? Well, there’s nationalization. That’s what the socialists wanted. Eugene Debs and the socialists thought trusts were great, because it’s easier to nationalize a big firm than a small firm.
Then there’s regulation, and then there’s countervailing power, to use the term again from John Kenneth Galbraith. The labor movement under Samuel Gompers in the early 20th century said, “well, we don’t want socialism. We’re not socialists. We want dynamic firms. We want to share their profits as workers. We don’t want our own little tiny mom and pop firms. We like working for steel companies and car companies, as long as we’re paid decently. We don’t want the government to regulate our wages and benefits because we think that the rich lobbyists will always have more clout in Congress than representatives of working people.”
So their solution, which I argue for, was countervailing power. You pool the labor power of workers, but then you negotiate with the big firms.
Now there’s technically a fifth option, which is even more absurd than the anti-trust option. That’s the libertarian one, where you just allow oligopolies and monopolies to grow, and they grow simply because they’re dynamic and efficient. But if they abuse their power you just turn a blind eye to it. And you have to be an ideological libertarian to believe that a janitor, an individual janitor, has bargaining power in a company with 500 people. That’s just pure nonsense and it’s been recognized as such. Even J.S. Mill, who is cited as a classical liberal thinker, was for unions, because he saw that there was no way one individual could realistically negotiate a contract of employment with a large firm.
AS: You claim that immigration has made this kind of negotiation more difficult by creating a split labor market that ends up hurting low-wage workers. Yet several studies have suggested that it was cultural anxiety, not economic distress, that best predicted support for Trump. Would it be fair to say that immigration is primarily a cultural battleground in this new class war? Or do you think the materialist story is underrated?
ML: That’s a misleading question. Most of the social science on Trump and Brexit is worthless because political scientists look for a single factor. Was it deindustrialization, was it racial views, was it age or whatever? And since you’re dealing with a society that’s quite stratified by class and divided by race, people have multiple characteristics that you can’t catch if you’re doing a regression analysis with one polling question. So I dismiss a lot of that stuff.
What I do in the book is build on Edna Bonacich’s idea of the split labor market. That’s when you have two populations competing for the same job. Sometimes they’re of different ethnicities, they can be from different regions of the country or from different classes, but each has distinct, identifiable characteristics. Employers prefer the population that is willing to work for lower wages, whatever its defining characteristic is. For example, in the 19th century industrial capitalists in the North brought in not just African-Americans, but also poor whites from the South to undercut unionization by mostly European immigrants in Northern industrial cities—often Irish-Americans, German-, Polish-, Italian-Americans. That’s a split labor market. Another example is employers bringing Chinese indentured servants to California to undercut unionization attempts by white labor activists. When that happens, there’s inevitably racial resentment as well as economic resentment. The Irish-American labor organizers in San Francisco will denounce the Chinese for their cultural characteristics, and, at the same time, they’ll denounce the capitalists for bringing in the Chinese to undercut their wages.
So you have to think about it as a three-way conflict among employers and two different groups of workers. It’s not simply a racist, anti-racist paradigm. On the other hand, it’s not pure economics, because there’s often ethnic resentment between these different groups.
AS: Immigration is part of a larger story you tell about global labor arbitrage. Can you expand on that?
ML: Arbitrage is making a profit by exploiting jurisdictional differences in the value of the same good—in this case, labor. It has nothing to do with productivity growth, and this is something that is confused in talks about globalization. If you shut down a factory in the Midwest and open up a new factory employing cheaper labor in South China or Mexico, using exactly the same technology, the profit of your firm goes up because the wage share of the profit has gone down. You’re no more productive than you were, and you don’t produce any more output because productivity is output-per-worker. The Chinese workers or the Mexican workers are producing cars and iPhones at the same rate as the American workers—they’re just paid much less. So that’s labor arbitrage.
You also get labor arbitrage with immigration. When employers bring in a group from abroad to work the same jobs that natives or naturalized immigrants have been doing, but for lower wages, the new workers are not more productive, or more skilled, or more efficient. They’re just cheaper.
AS: You hold up the post-World War II settlement as a model of democratic pluralism—not just in economics but also culture. That settlement arguably rested on a shared moral consensus—in particular a shared Christian consensus—that’s since broken down. The working class has become more diverse, not just ethnically but religiously, philosophically, morally. How do we have cultural power-sharing agreements when there’s no shared culture, even among the working class?
ML: Well, I disagree with that characterization of the postwar period. Up until then you had a mainline Protestant establishment in the United States that was very anti-Catholic and anti-Jewish. And so Jewish kids and Catholic kids had to recite Protestant prayers in schools and sing Protestant hymns. Americanization was stripping them of being Jewish and Catholic. And evangelical Protestants suffered as well because these were mainline Protestants who didn’t like evangelical Protestants.
But after World War II, the United States created what the sociologist Will Herberg called “the triple establishment.” He wrote a book called Protestant—Catholic—Jew. And I’m old enough to remember that at every high school commencement, you had a priest, a minister, and a rabbi. So it was pluralistic. Now the term “Judeo-Christian” was invented around that time, to pretend these religions are all part of the same thing, which their theologians will dispute. I’m not saying we should return to that and ignore secular people, particularly with secularization increasing in the U.S. as in Europe.
But I think we’ve moved back toward a secularized Protestant mainline establishment. And if you look at a lot of the “wokeness” we see today, it’s kind of a secularized version of New England puritanism, at least in the United States. They go after exactly the same people that the old Northeastern mainline did: Southern evangelicals, Catholics, and traditional, non-liberal Jews. Muslims as well, although they treat Muslim as a racial category to be favored rather than a religious conservative category, although most Muslims are religiously conservative.
So I argue that we don’t want a French-style anticlerical state, which wants to ban all displays of religion and be aggressively secular. That’s not the American tradition. It’s not the Anglo-American tradition. You also don’t want the elite’s religion—which in the old days was mainline Protestantism, nowadays you’d call it mainline secularism—to simply dominate the media and education. So I think we have to go back to some kind of institutionalized representation. Maybe it will be the priest, the minister, the rabbi, the druid, and the atheist. But I think that’s a much healthier approach in a society where you have deep permanent value pluralism, as the philosopher John Gray has argued. You have to have what he calls a modus vivendi, an agreement to live and let live and co-exist.
AS: In your book, you note that there used to be religious and cultural bodies that were informally charged with oversight of education in the media. Organizations to which films were submitted for approval.
ML: Yeah, the Legion of Decency, which was originally a Catholic organization. It got to the point where Hollywood would just submit the films to them. There’s this wonderful movie by the Coen brothers, Hail, Caesar, about making a biblical epic in the 1950s. There’s a great scene where they have a Catholic priest, a Protestant minister, an Orthodox Christian priest, and a rabbi, and the poor studio guys are trying to make sure their film doesn’t offend anybody.
Now, if you’re a free speech zealot of the romantic libertarian bent, then the more shocking to public sensibilities, the better. And I don’t want to go back to the old days where they were censoring Catcher in the Rye in the libraries. But on the other hand, come on. If you have a society that is half wiccans and half Nordic Asatru Thor worshippers, what is the goal of your policy in education and so on? Is it to constantly insult and humiliate the two groups that are the biggest groups in your society?
And what about parents? If you have compulsory public education, then the views of the parents ought to be respected by educators, right? Now again, this is not anticlerical France where the public school is a way to de-program Catholic school children and turn them into French Jacobin Republican citizens. I’m very supportive of mandatory viewpoint diversity in K-12 and higher education, and also in the media because let’s face it, the mass media are a de facto public utility. It’s how people communicate, it’s what shapes perceptions. And to say that it’s a purely private thing, so if you don’t like it, go found your own radio network or your own TV network or your own social media platform . . . I don’t think that’s realistic.
AS: You note that in the past, Catholics played a role out of proportion to their numbers when it came to policing the culture. What sort of minority group, if any, do you think would fill that role today? Is there a particular subgroup that’s well-positioned to revive these religious or cultural bodies?
ML: There is a kind of a revival of Catholic social thought on the right wing of the Republican Party, with people like Marco Rubio saying good things about unions. You see flickers there of this older Catholic influence, both in working-class economic areas but also in the culture. Like Protestants, Catholics are declining as a percentage of the population. Southern evangelicals, because of their dispensationalist ideology—thinking the end of the world is near—did not for obvious reasons put a whole lot of effort into thinking about the details of public policy.
We’ll see what happens with American Muslims. What you saw with Catholic immigrants and Jewish immigrants was that even as they became less ethnic diasporas, they remained religious believers. There were new Jewish-American and Catholic-American establishments. I think we may see that with both Sunni and Shi‘a Muslims. And to the extent that they don’t accept the idea that we’re just going to go along with whatever the Ivy League schools say, to the extent they reject the woke secular liberal attitude, they may play a role.
AS: You also have a very interesting passage where you say that terms like transphobia, homophobia, and Islamophobia medicalize politics, and treat different viewpoints as evidence of psychological disorder. Why has this become one of the go-to methods for invalidating dissent in the United States?
ML: Well, it has very deep roots, nearly a century old. If you go back to the 1920s and 30s, many of the intellectuals in the Western world were just completely entranced with Freudianism, and with other kinds of modern psychology. They thought that this was a science and it explained human behavior. And so the whole project of redefining morality in terms of psychology and therapy goes back to Freudianism, and then you get these increasingly dumbed down versions of it where one moral dispute after another—over gay rights, over trans rights, over immigration—gets medicalized so that instead of this being a dispute based on thousand-year-old religious texts, the people who hold a certain view are simply emotionally disturbed. And the cure for that is therapy.
You see this with diversity training. The premise is that if you don’t agree with whatever the accepted positions are, then you need to be reprogrammed. To become a productive, normal person, you need therapy. And I think this is just very sinister and totalitarian. Obviously there are emotionally disturbed people who hate homosexuals, and there are deranged individuals with a completely insane hatred of people of another race. But as I say in the book, an Orthodox Jewish rabbi who disapproves of homosexuality, but also of abortion and divorce and adultery, is just following the teachings of Judaism, right? The rabbi is a perfectly normal, well-adjusted person. That’s just the theology. If you want to fight the theology, denounce the theology.
But when you have the elites in charge of education and the media essentially adopting as their working hypothesis that anyone who disagrees with them needs therapy—this is very sinister.
AS: It seems like this medicalization of politics has coincided with the rise of outlets like Vox, which you criticize more than once in The New Class War. Is that just an accident, or have both trends been driven by the same technocratic impulse?
ML: Yes, Vox very much represents what I call technocratic progressivism—the idea that there is one “correct” answer which is also the moral answer. And so if anyone disagrees with the Vox policy, either they’re ignorant or emotionally disturbed. It’s very patronizing.
Having said that, the right has its own version of this, where anyone who disagrees with the right’s policies is a traitor or an instrument of Satan or morally evil or stupid. So you find it on both sides.
But the medicalization tends to be associated with the overclass center-left, not the radical left. The Marxists don’t do this because they believe in class conflict. I think their theory of class and class conflict is wrong, but they’re actually closer to reality than the technocratic progressives who think that if everyone were sane and smart, there would never be any conflicts at all.
AS: You’ve talked about technocratic progressives, and alluded to what might be called technocratic libertarians. Is there such a thing as technocratic populism, which genuinely responds to populist complaints through market-based, technical solutions? Or is technocratic populism a contradiction in terms?
ML: I think it’s a contradiction in terms, because if you believe as I do that the root of populism is a power deficit, then it’s not a matter of getting the right policies. You actually have to redistribute power, and redistributing power to working class people means they have the power to be wrong and support dumb things. And their representatives have the power to make bad decisions.
So I don’t think you can come up with a kinder and gentler version of technocratic progressivism where you just do better polling or you’re just more benevolent and more sensitive to working-class people. You have to talk to them. I spent two decades in the NGO world. Apart from receptionists and janitors, you never encounter working-class people. The idea that you would actually go out there and ask them what their problems are, that almost never happens.
To be clear, there are some good things that come out of the technocratic approach. You don’t expect working-class people to tell you statistically what the best health insurance option is. I’m not talking about that. I’m talking about basic preferences. The politicians do go out and supposedly hear from people at the diner when they’re trying to get elected. But the experts in a think tank or university who are coming up with the plans that the politicians then sell to the people at the diner—those experts don’t have much contact with the working class.
Fifty years ago in this country it worked differently. The parties were federations of state and local parties, so word could go forth from Washington to persuade people that yes, this is the way to do it. And often that worked because the people involved in the local Democratic or Republican machine trusted the county precinct chairman. But the people in DC also heard from the grassroots. County people would talk to the state people, state people would send the message that things are going on out here. Now that the parties are just shells bought by billionaires, you don’t get that.
As for unions—they did bad things as well as good things, all human organizations have trade-offs—but it meant that there was some kind of mechanism for working-class revolts to get somebody’s ear up above. And in the absence of unions you get polls. “There’s a poll that shows the working class believes X, there’s a poll that shows the working class believes Y.” In the old days you asked the shop steward or the foreman what the working class thought; you didn’t have a telephone poll. That shows the extent to which all these connecting levels of organization have vanished, if the only way to find out what people are thinking is by calling them randomly and asking their opinion.
AS: It’s ironic, isn’t it, that some of the changes that hollowed out the parties were initially justified on the grounds that they weren’t representative enough. Would it be fair to say that these kinds of populist reforms backfired and produced democratic deficits?
ML: Yeah, I think that’s right. Now, sure, there were corrupt smoke-filled-room politicians. There were sleazy union officials who were embezzling from the union, there was sexual harassment among religious figures. These are human institutions.
But in ancient Rome, there were the tribunes, whose role was to represent the ordinary people against the senatorial class. And the moment it was reduced to one tribune—who happened to be Caesar—that was the end of that system. So you have to have lots of little petty tribunes, lots of petty power brokers, whom the metropolitan liberals never liked. The elite conservatives never liked them. Everybody looked down their noses at them, and at the church ladies, and at the corrupt local union boss, but they’re all gone now. They’re all extinct, just like the dinosaurs. So there’s this huge void in between. Nothing’s perfect, but I think we do have to rebuild this group of intermediate brokers so that you don’t simply have a political system that consists of donors, advertising experts, and policy wonks who live in New York and Washington and maybe San Francisco.
AS: Two proposals that have been voiced by those policy wonks in recent years are universal basic income and trust-busting. In the book you reject both of these proposals. Why?
ML: Well, universal basic income has always been rejected by pro-labor people and by social democrats on the theory that if the working class has power through collective bargaining and other means to force employers to pay a living wage, then you don’t need a universal basic income. If you work 40 hours a week—and there’s dignity to work—then it’s profoundly humiliating to say that a few rich CEOs are the only productive people in society, and everyone else is some kind of parasite. But to bribe them into silence, we’ll just pay them off—this is utterly abhorrent to the idea of the dignity of labor. It’s abhorrent to the idea of a democratic Republic. Instead, you have an aristocracy passing out charity to people.
So that’s the moral and political reason for rejecting it. The practical reason is, does anyone think that these billionaires who are hiding all of their income in the Cayman Islands are going to consent to be taxed to give everyone $12,000 a year? I don’t believe that for a moment. Right now you can’t even raise taxes on people making $100,000 or $200,000 a year. If the middle class is defined as anyone making less than $200,000 a year, we’re not going to raise taxes on them. So where’s this money coming from for the UBI?
And I’ve already touched briefly on the fact that trust-busting is anachronistic. What’s particularly absurd is they’re trying to argue that inequality has gone up, not for the real reason, which is that unions have been crushed and labor markets have been flooded by low-wage immigrants, but because of the monopsony power of big corporations. Okay. So let’s say you break Facebook into five giant firms. Do we really believe that the janitor is going to have five times the bargaining power in these baby Facebooks? That’s ridiculous. It’s not going to happen.
AS: Five times zero is still zero.
ML: Yeah. But what you see with the Democrats is they’re rapidly being taken over by formerly Republican libertarians and moderates. So as the Bush Republicans and a lot of libertarians, even the Koch brothers, are distancing themselves from the Republican Party, are moving away from the GOP because it’s becoming more blue-collar—well, when Bush country club Republicans decide, “Oh, I hate Donald Trump, I’m going to switch to the Democrats,” they don’t necessarily change their views about taxes or immigration or unions.
I’ll give you an example I use in the book. The overwhelming majority of congressional districts in the 2016 elections that went for Clinton are among the wealthiest districts in the United States. And Trump got among the poorest districts in the United States, so the idea that the Republicans are the country club managerial capitalist party and the Democrats are the AFL-CIO steelworkers is like 20, 30 years out of date. It’s all in flux.
AS: Many of the power-sharing proposals you favor work by creating veto points that let workers say no and force a compromise. Do you worry that this might make us less competitive in the international arena? China doesn’t have many democratic constraints on the market, after all, because it’s not a democracy. Is it possible to create veto points without sacrificing efficiency, and with it our competitive edge?
ML: Germany has had strong unions and co-determination, and its manufacturing industries are in many ways more advanced and successful than in the United States, where companies just want to crush unions and go for the cheapest possible labor. Japan is very paternalistic, but they have good labor relations as part of this kind of welfare capitalist system. So if you look at export competitiveness, the anti-labor countries like the U.S. and the UK don’t do that well compared to the ones that have some kind of harmonization among their workforces and employers in manufacturing.
What dictatorships like China can do is mainly through credit, not cheap labor. They can dump products below cost on the rest of the world. And the classic dumping strategy, whether it’s from a firm or a nation, is that you deliberately sell below cost long enough to drive your rivals out of business. And then at that point you have a monopoly in the market, which means you can jack up the price to recoup the losses you incurred during the dumping phase. So if you have government-owned enterprises, or nominally private enterprises that in practice have an unlimited credit line from the government or from banks the government pressures, there’s no way any private enterprise can compete with a state-backed corporation.
So if you believe in industrial capitalism as I do—I think it’s the most dynamic system for increasing wealth and innovation in history—then you have to block entry into your market by state-capitalists, otherwise they will wipe out your firms. This should not even be debated.
AS: In closing, I want to ask a couple big-picture questions. Patrick Deneen, the author of Why Liberalism Failed, recently tweeted that The New Class War is “THE essential book of the decade.” Do you agree that liberalism has failed? And if not, why do you think that a lot of post-liberals have been raving about your book?
ML: Well I think there’s agreement among people with very different views of history that what we call “liberalism” now—which I would call libertarianism or neoliberalism—has moved toward hyper-individualism in the culture and deregulation of the economy, and that this is a bad thing. It’s bad for community. It’s bad for the nation-state. It’s bad in the long run for the capitalist economy because it undermines its foundations.
Where you get debate is on the question of when this started. To my mind, the neoliberal era started in the ’70s and really got underway after the Cold War. For some of the critics of liberalism, like Deneen, it starts with the Protestant Reformation or with the Enlightenment. That’s an interesting debate to have, but it’s a philosophical debate. And I think that whatever your theory of the case, you can agree that the neoliberal moment is hopefully over, and that it’s time to create a new system, which I for one hope will incorporate the good things about neoliberalism: emancipation of sexual minorities, a lot of the gains in civil rights and civil liberties. So you want the pendulum to swing back, but not necessarily all the way to where it was before neoliberalism. You just correct the excesses in the next stage of history.
AS: You don’t seem to have much faith in either political party right now. Do you think the power-sharing you envision can plausibly arise without any help from established politicians, or are things going to get a lot worse before they get better?
ML: In the book, I argue that ruling elites generally share power only when they’re forced to. And they are forced to either by fear of insurrection from below or by a fear of competition with other countries. In most cases it’s very difficult for weak, disorganized working-class people, or in the old days peasants, to overthrow the regime. So the elite doesn’t have a whole lot to worry about from below. If you look at the creation of the mid-century class compromise I document in The New Class War, it was done largely during World War II in the United States and in Britain and in Germany. The left doesn’t like to admit this. They want to pretend it was just a spontaneous upwelling from below. But in fact union membership shot up radically during World War II, because the Roosevelt Administration ordered firms to switch to war production, to make a deal with unions in the interest of defeating the Axis powers.
So at this point, I’m actually very pessimistic. I think that absent some kind of sustained international rivalry, where a section of the managerial elite comes to understand that constant labor and cultural warfare undermines us in international competition, so that they will have to broker a truce to save themselves—I think absent that, you get a situation like a lot of South American countries. Brazil and Mexico, Central America, arguably they suffer because they never had a major war, and thus never had any incentive to extend power to ordinary people. So they’re very oligarchical to this day.
AS: Do you think competition with China could potentially catalyze a class truce?
ML: It could, but I’m a realist in my foreign policy views. So I tend to see international politics as a series of either low-level or very intense competitions among different great powers. So if it’s China now, it may be a rising India 50 years from now, and it may be somebody else in a hundred years. I think it just makes sense as a matter of prudence for a nation-state that’s also a great power, like the United States, to have a kind of permanent low-level mobilization, which we didn’t do after the Cold War.
I think future historians will be puzzled by the idea that the bipartisan establishment had that there would be no more great power conflicts—that we could move much of our manufacturing and R&D to China, our most likely competitor, and have nothing to worry about. Sure, it lowers consumer prices. But if you think that today’s trading partner may be tomorrow’s military rival, it doesn’t mean you’re not going to engage in trade and immigration, but it does mean you’re going to have some limits on those things for national security reasons. And again, for national security reasons you do not want class conflicts, racial rivalries, religious disputes to spiral out of control. It undermines the strength and harmony of your country in a dangerous world.
AS: Last question: Your theory of the case is very much a systemic one. It’s a story about structures and institutions and systems, how they’ve changed and how they’ve changed for the worse. What, if anything, can individuals do to promote the kind of systemic change you want to see in the United States?
ML: Well, I think the first thing they can do is get off Twitter, and stop following national news obsessively, which is largely something the educated upper-middle class does. Working-class people are working, they don’t have time, but if you’re just re-tweeting angry memes about national politics, that’s not politics. I don’t know what it is. It’s a kind of entertainment or something.
So start with your neighborhood, start with your city. It’s not going to be enough—obviously you have to have the top-down element too—but real politics is getting the dangerous intersection fixed. It’s taking part in a group. If the only thing you do is you vote and then retweet cartoons about the other party, you’re not really engaged in politics, right?
So you have to be part of some kind of group. It can be a community group, it can be a religious group, it can be a party group. You’ve got local Democrats, local Republicans. But I think the best way to break the tendency toward increasing nationalization of everything starts with the individual. It starts locally. When I teach I’m kind of amused, if not shocked, by the tendency of young people to think that if there’s any problem, Washington should fix it. If you need a bike path in your city, then Congress should allocate money for the bike path. Well, okay, but why don’t you try raising money door-to-door for the bike path? And if that doesn’t work, why not go to the city council? And if that doesn’t work, there’s the state legislature. We really are drifting toward this system where it’s assumed that if you elect the right President, then all problems, state and Federal and local, social and economic, will be solved because the President has the right policies.
The Democratic primary has just seemed unreal to me for this very reason because now each candidate has his or her own party platform. They’re basically one-person parties, and they’re expected to have a platform for every single thing. Up until recently, the President was just the head of the party in Congress, and the party had different wings. There were the farmers and labor and African-Americans, there were consumer groups. The party platform reflected the relative power of those groups, and the President vowed to help carry out the party platform.
I think we’re moving toward a nationalized plebiscitary presidential system, where the president is freely elected, but it’s a kind of elective dictatorship: an all-powerful Caesarist or Bonapartist presidency will just solve all of our problems, and then if anything goes wrong in the country it’s the President’s fault, even though the President didn’t have all that much power in reality. Real politics starts locally and consists of having groups of people working together on common projects beginning at home.
