Congratulations. You've made the cover of Newsweek: "Is a new elite of highly paid, high-tech strivers pulling away from the rest of America?" Welcome to the "overclass," America's latest social problem.
The Bionomics Institute has given you a copy of the Reason editorial I wrote on the subject(October 1995), so I don't want to simply repeat it. Instead, I want to put the overclass debate in a broader political-intellectual context and give you some of the arguments behind it.
As those of you who heard me last year may remember, I believe that the traditional left-right political spectrum is increasingly unsatisfactory at explaining today's political alliances. Instead, it is much more useful to think of a spectrum divided between proponents of stasis and proponents of dynamism, between people who want to stop, reverse, or plan the social and economic future and people who embrace an open-ended, unpredictable future created by individual choices. (I'm currently working on a book developing this theme called The Future and Its Enemies, which will be published by The Free Press in 1998.)
One small example: Nothing expresses the conventional left-right dichotomy more than Crossfire. And the first Crossfire of this year was devoted to the future: not the future of the new Republican Congress, or of Bill Clinton's political career, or of any particular policy, but the future in general. And the show turned into a love-in between Pat Buchanan on the right and Jeremy Rifkin on the left.
Both were convinced that the future is bleak and that soon the only jobs left in the economy will be for brainiacs. Both wanted vigorous government action to restore what they perceived as the economic stability of past eras. Buchanan and Rifkin were both taken aback by their newfound alliance. They kept saying things like, "You sound like a Pat Buchanan column" and "I find myself…agreeing with Pat…, which gives me alarm." I wasn't a bit surprised, however. I've been using Buchanan and Rifkin for years to illustrate the static end of the spectrum. Indeed, they are among the purest representatives of one camp within that grouping: what I call Reactionaries, people who want to reverse change and restore the real or imagined past.
There is another important camp of Statics–which I call Technocrats. These are people who want to manage the future, to plan it from the top down–people who dislike open-endedness and unpredictability, people who would be profoundly uncomfortable with the ideas represented by this conference. Ira Magaziner and Ross Perot are, in different ways, Technocrats; it's no accident that both like to dictate not only how the government should run things but how other people's businesses should work.
The most important Technocrats in our political history are the people who coined the term, the turn-of-the-century Progressives who used engineering rhetoric and engineering models to argue that government experts should regulate our society and economy to ensure "efficiency" and equity. Many engineering-minded Progressives believed that diversity was inefficient and wasteful, that central planning would conserve resources. They were not for the most part socialists–they didn't want government to own the means of production–but they definitely believed in top-down direction.
Technocrats, by design, pick winners, establish standards. They impose a single set of values on the future. As Progressive founding father Herbert Croly wrote: "In becoming responsible for the subordination of the individual to the demand of a dominant and constructive national purpose, the American state will in effect be making itself responsible for a morally and socially desirable distribution of wealth." And wealth distribution is only part of the picture. The Progressives also sought, for instance, to plan the nation's ethnic distribution, implementing for the first time an elaborate system of immigration quotas.
To get back to the official subject of my talk: What's interesting about the attack on the so-called overclass is that it unites both groups of Statics, both the Reactionaries and the Technocrats, in a single campaign against economic dynamism: a revolt against the growing number of affluent, well-educated Americans.
First some numbers, by way of background: As David Frum pointed out in a New York Times op-ed on the subject, the proportion of American households earning less than $25,000 in real dollars hasn't budged for two decades; it stays around 40 percent. But the middle class has been shrinking. Between 1980 and 1993 the proportion of households earning between $25,000 and $50,000 dropped from 50.7 percent to 47.1 percent. Where have the middle-class people gone? Not into poverty. Instead, the middle class is shrinking because more people are making more money than ever before in our history, because the economy is more open to talent. Frum writes: "Just as the American economy pulled its most talented people out of poverty in the 1950's, it pulled the ablest of its middle class into affluence in the 1980's."
This happy news has not escaped the attention of our ever-busy statis-pushing social critics. For about the last five years, a number of influential intellectuals, ranging from Robert Reich to Charles Murray, have been on a campaign to get America worried about knowledge workers. (In my editorial, I give a list of books in which this case is made; several of them quote lavishly from each other, which gives you some idea how social critics spread their ideas.) The knowledge workers we're supposed to worry about include not just high-tech types but, even more prominently, lawyers, professors, and journalists. In fact, the people making the critiques, with the possible exception of Reich, are so immersed in their own political-intellectual world that they really didn't think much about the "technology elite" until Wired came along and rubbed their faces in it. If you read the Newsweek article, you'll find that most of the time it seems to be talking about the Washington wonkocracy.
So…If you don't like economic dynamism, the so-called overclass makes an excellent target. Among Reactionary Statics, some critics such as the late Christopher Lasch have long extolled the virtues of traditional blue-collar neighborhoods, with their animus against mobility, learning, and cosmopolitanism. Lasch, quoting another writer on the famous ethnic neighborhood in Boston, speaks fondly of the "Charlestown ethic of getting by" as opposed to "the American imperative to get ahead." He says, "The people of Charlestown, deserted by the migration of more ambitious neighbors to the suburbs, had renounced`opportunity, advancement, adventure' for the `reassurance of community, solidarity, and camaraderie.'" So should we all, Lasch suggests. The Reactionary attack on knowledge workers is simply a subset of the broader attack by critics such as Lasch on commerce and science, which they see as disrupting traditional ways of life.
Most of the overclass critics are, however, Technocrats who, like Croly, believe they know the proper income distribution and would like to do something to impose it. That something is often vague. Some writers, such as Michael Lind, look favorably on high taxes (particularly a wealth tax), trade protectionism, and immigration restrictions. Others, such as Robert Reich, believe more government training and education programs are the answer. And everyone except maybe Charles Murray would like a mandatory national service program, which would neatly confiscate several years of everyone's life, essentially taxing human capital (and human capital formation).
What exactly these Technocratic critics are worried about is somewhat unclear and varies from person to person.
Sometimes, for instance, they seem to be worried that the overclass is too open, sometimes that it isn't open enough, and sometimes that it's open now but will somehow close up in the future. For instance, Michael Lind, who coined the term "overclass" in his book The Next American Nation, is a big critic of university admissions policies that favor alumni children. He rightly considers these "legacy" admissions anti-merit quotas, though he doesn't note that they've been steadily eroding over the past few decades–which one reason the fluid non-hereditary national "class" he's so concerned about has arisen. It's hard to simultaneously denounce both "legacy" admissions and meritocracy. But Lind manages.
But let me be fair, or at least generous, and try to summarize these critics serious concerns.
Most of them are ideological egalitarians, people who are concerned not merely that poor people have some basic standard of living but that the income "distribution" be as flat as possible. So one of their big concerns is inequality–that people who have education and intellectual skills are getting richer while everyone else falls behind (even if "falling behind" means a higher absolute standard of living). They would prefer a static, large middle class even if that means holding people back.
What makes the inequality even worse is "assortive mating." When you let women into elite schools and high-paying professions, professional men marry them instead of lower paid women. That makes the distribution of household incomes even more skewed. If you have two doctors, making $80,000 a year, and two nurses making $20,000, in the good old pre-feminist days you could pair them off to get two households with $100,000 incomes. Now the doctors marry each other, giving them a household income of $160,000, and the nurses marry each other, giving them a household income of $40,000. Presto, more inequality.
Every overclass critic makes this point, some such as Lind and Lasch in quite nasty terms. It's absolutely mathematically correct. It's my personal favorite part of the overclass critique because it is such a bald call for closing off opportunity and even denying romantic choice. What we have is allegedly liberal writers arguing either that women shouldn't hold professional jobs or that professional men should at least have the decency not to marry them. Needless to say, all the overclass critics are male.
A second common fear is what Robert Reich calls "secession"–the concern that knowledge workers are withdrawing from public institutions, asking for tax cuts, and eroding support for traditional "public goods." This includes most prominently the public schools. But few attacks on the "overclass" manage to omit the specter of gated communities and shopping malls–that well-known elite phenomenon–that privatize streets, sidewalks, and security.
Again, the argument is highly ideological. (One of its major sources, in fact, is the Marxist urban critic Mike Davis.) It's true that as the proportion of wealthy people in the population grows it becomes more and more difficult politically to pick on them–to soak the rich. But "secession" is a middle-class phenomenon, too, as the very example of shopping malls suggests. Many of the people who want to close off their neighborhood streets live not in Bel Air but in places like Lafayette Square, a middle-class enclave off Crenshaw Blvd. in Los Angeles–in other words, in stable neighborhoods threatened by surrounding disorder. And you see very few overclass critics pushing ideas like school choice that would use tax dollars to open up havens of quality and security to the less affluent. Michael Lind, in fact, goes out of his way to portray school choice as a nefarious right-wing plot. (He does, however, support a complicated scheme for nationalizing the universities.)
Sometimes overclass critics worry about snobbery. They seem to fear that well-paid knowledge workers think they're better than other people–which is, I'll grant, is exactly the impression you get fromWired's media kit. Mickey Kaus writes, for instance: "It's one thing to have an unequal distribution of income. It's another to have that same distribution of income rigorously based on schooling and skills. In the latter situation, those with more money will be able to claim not just that they have more money, but that they have something else, knowledge, that makes them more valuable. The pay-for-skills trend lends all income differences, small and large, a nasty meritocratic bite."
Mickey confuses economic value and merit–maybe "virtue" would be a better word. Of course, people who make more money have something that makes them more valuable–by definition. What's different in the economy today is that the something is a combination of knowledge and education, the very attributes intellectuals have themselves always valued and which they have denounced markets for undervaluing. So it's not surprising that intellectuals, whether they praise or condemn knowledge work, get confused between value and virtue. This is an important point,which I'll return to.
Another fear is that if Harvard and Princeton are open to a wide variety of smart students, instead of just the sons of the social elite, it's harder to get people to look at you seriously if for some reason you went to University of Florida or Rutgers (to name schools whose graduates I've hired at Reason). Such exclusion does in fact exist, particularly in the circles in which these critics travel. (Michael Lind is truly remarkable because he managed to get a job at The New Republic without spending time at Harvard.) However, the very economic value of brains suggests that employers smart enough to look outside the usual circle can find "buried treasures" overlooked by their competitors and gain an edge. Besides, I'll believe these people are sincerely concerned about exclusion when The New Republic starts advertising job openings to its readers.
Finally, a concern articulated exclusively by Charles Murray–whose more-or-less libertarian politics are diametrically opposed to those of most of the other overclass critics–is that the "cognitive elite" will rig the rule of the game against the rest of America. It's much easier to maneuver through a highly regulated economy, for instance, if you've got a very high I.Q. and a law degree from Harvard. And tangles of laws also make more jobs for high-priced lawyers.
I agree with Charles that we should worry about that sort of rule-rigging, but I see no evidence that a more open economic elite has made it more common. In fact, critics such as Lind are profoundly worried that the "overclass" is too libertarian, on both economc and social issues.
And the rise of what Times Mirror's polling center calls "Enterprisers" has pushed politics in a deregulatory direction. The Enterprisers are the political reflection of the economic trend overclass critics are deploring: The most politically aware, active, and vocal segment in American society is no longer traditional liberal intellectuals– the group Times Mirror calls "Seculars"–but this educated, affluent, entrepreneurial, and quite anti-government group. A more open elite has produced anti-Technocrat politics. When America has more entrepreneurs than union workers, political support for the rule of the few on behalf of the many disappears: There are just too many people, with too much education and too much money, accustomed to making their own informed assessments of the world around them and running their own lives to support old-style social engineering.
Now that all you overclassers are feeling good, I want to end on a cautionary note about meritocracy.
I am all for the open opportunity represented by the term meritocracy, the notion of evaluating individuals on what they have to offer rather than on race, sex, social background, or whatever. But in technology circles these days, you find a lot of self-congratulation,. The technology "overclass" is made up of people who are not only unapologetic but, you've got to admit, sometimes rather smug. If you spent your youth being ostracized as a nerd, it's understandably tempting to turn the tables. Hence the superior tone that so aggravates the critics of Wired.
A word of caution, however: It's easy to imagine a world where today's hot engineering field becomes tomorrow's backwater.The Graduate picked "plastics" because it was a cutting-edge field, just the sort of thing a bright young man ought to be getting on the fast track of. In fact, my 60-year-old father has spent most of his career learning everything there is to know about polyester film and seeing polymers go from the coolest of the cool to just another everyday substance.
It's harder, but not impossible, to imagine an economically advanced world in which knowledge itself, at least as we're accustomed to thinking of it, isn't particularly valuable. Fortunately, science fiction writer Bruce Sterling has done the imagining for us, in his short story "The Beautiful and the Sublime." In the world of the story, artificial intelligence flows like electricity, making rationality a drug on the market. Engineers survive on grants from wealthy patrons. Artists rule, both in the marketplace and in the culture; emotional outbursts, flamboyant dress, and grand gestures are socially rewarded while cool rationality and an even temper make you an outcast. It's a fascinating thought experiment.
We would, I believe, be much better served to stop talking about meritocracy and start talking about valuocracy–a system based on what the market values at any given time. We should drop any suggestion that this is a debate about merit, about virtue. It's true that whatever virtue is in short supply, whether it's mathematical ability or bravery in battle, will be rewarded not only financially but socially. But that does not mean it is the only, or the most important, virtue. Different circumstances reward different virtues and, indeed, some genuine virtues may even be contradictory.
On a related point, as the great Nobel laureate economist and social philosopher Friedrich Hayek pointed out, the income distribution is a misnomer. Nobody is sitting on high handing out dollars. The income distribution is simply the emergent order created by individual trades of services for goods (or money). It has nothing to do with virtue, nothing to do with merit. Suggesting that it does, or that it should, means suggesting that someone be empowered to evaluate the relative virtues of everyone in society and reward us accordingly. That is a recipe not merely for stasis but for totalitarianism.