Why the upper-middle class would benefit from socialism
The Democratic Party is picking up new recruits from a rather strange place: the upper-middle class. The suburbs and traditionally Republican-heavy professions like doctors are tilting more and more toward Team Blue.
These groups have traditionally been heavily neoliberal — favoring markets, privatization, welfare cuts, and so on — in their economic ideology. But as the Wall Street Journal explains, doctors have become more diverse, and less likely to own their own practices, instead often working for gigantic oligopolist hospital chains. Or take software engineers, who can make tremendous salaries, but still work grueling hours and are subject to the whims of abusive bosses. The recent shift in the suburbs likely has a good deal to do with revulsion to Trump, but also demographic changes that won't be reversed any time soon.
Conceptually, there are therefore two basic ways this situation could evolve: either the Democratic party turns to the right to cater to these upper-middle class values and their perceived self-interest, or that group continues to turn to the left and pulls the party with them. But the upper-middle class — let's call them the top fifth of incomes, minus the top one percent — shouldn't stop there. They should become fully socialist.
Let's define socialism in rough-and-ready Karl Polanyi fashion as reforming society such that the economy is subordinated to democracy. At a minimum, that means a complete welfare state and taking democratic control over a goodly portion of the national capital stock.
So first, let's consider welfare. If we count hidden social spending in the form of tax credits and so on, the United States has one of the most expensive welfare states in the world. As of 2015 it cost 30 percent of GDP, the second-highest figure in the OECD (behind France). And it's that expensive because it's both set up to benefit mainly the top half of society while flattering bourgeois notions about property and taxation. Stuff like the mortgage interest deduction subsidizes social goods while allowing wealthy people to pretend like they aren't actually collecting benefits.
There's just one problem: This corporatist welfare state is utter trash. Even in the glory days of pensions, far too few workers had them. Making employers the source of things like health insurance means that if you lose your job you probably lose your insurance. And the ultra-complicated, fragmented insurance system means steadily-increasing prices — the total cost of employer-sponsored insurance for a family recently passed $20,000 per year.
Most of all, the corporatist American welfare state is hideously inefficient. We spend 30 points of GDP and yet are missing absolutely basic stuff like paid family and sick leave that peer nations have had for decades. It's just crap policy design.
If we were to build out a proper full-dress welfare state — including stuff like the People's Policy Project's Family Fun Pack, Medicare-for-All, a sizable boost to Social Security, unemployment, and disability benefits, free college tuition, and so forth, the vast majority of the upper-middle class would come out basically unharmed or money ahead. They would pay a lot more in taxes, but they would get a lot of quality benefits — stuff like childcare and college is a huge cost burden for this group. It is the top 1 percent, and especially the top 0.1 percent and up, who would really get taken to the cleaners.
Similarly, scooping up, say, half the wealth in the country into a social wealth fund, which would distribute its return on a per-capita basis, would leave most of the upper-middle class in fine shape. The top 1 percent owns about 40 percent of America's wealth, and the next 4 percent (that is, those in the 95th to 99th percentile) another quarter. The bottom half of the upper-middle class, meanwhile, only owns about a tenth. Once more, the tippy-top would be the ones who would really pay.
The second major benefit for the upper-middle class is harder to quantify but no less real. All the above would drastically reduce economic inequality in the U.S. — one of the most horrible social poisons of our age, even for people doing relatively well. As Steve Randy Waldman writes, extreme inequality means extreme consequences for those high up the ladder who fail to maintain their social position. That is surely part of why moderately-wealthy parents today are so obsessive about trying to claim every possible advantage for their children by buying tutors, cheating college admission procedures, and so on. Many quite wealthy people live lives of suffocating anxiety, gripped by fear they will lose their grip on social status and a comfortable lifestyle.
Conversely, if incomes are all reasonably good no matter one's job (obtained through mass unionization and wage compression), and one is guaranteed health care, free education, and a decent standard of living no matter what happens, people can live much more relaxed lives. You won't have to bludgeon your kid into getting an MBA or working for Goldman Sachs just so they don't end up on the street. They could follow their dreams of playing the trombone instead, and it would be just fine.
Now, it is by no means guaranteed all the upper-middle class will be swayed by arguments like this — on the contrary, many are committed Trump-supporting reactionaries. And obviously Democrats should not abandon outreach to the middle and working classes. But bourgeois ideology doesn't have a death grip on this entire group — and many of its professions (think software engineer or game developer) have been seriously proletarianized over the last decade or two. If they can be convinced to join up with the working class in a socialist political formation, it would be much more durable — and they really would benefit.
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