I wanted to draw your attention to an article by Matthew Stewart in the Atlantic, remarking on the development and divergence of the 9.9%:
By any sociological or financial measure, it’s good to be us. It’s even better to be our kids. In our health, family life, friendship networks, and level of education, not to mention money, we are crushing the competition below. But we do have a blind spot, and it is located right in the center of the mirror: We seem to be the last to notice just how rapidly we’ve morphed, or what we’ve morphed into.
The meritocratic class has mastered the old trick of consolidating wealth and passing privilege along at the expense of other people’s children. We are not innocent bystanders to the growing concentration of wealth in our time. We are the principal accomplices in a process that is slowly strangling the economy, destabilizing American politics, and eroding democracy. Our delusions of merit now prevent us from recognizing the nature of the problem that our emergence as a class represents. We tend to think that the victims of our success are just the people excluded from the club. But history shows quite clearly that, in the kind of game we’re playing, everybody loses badly in the end.
Read the whole thing. Those of you who are regular readers here may notice that this is a subject to which I’ve returned a number of times. I’m much more concerned about the allegedly meritocratic 9.9% than I am about the .1%.
Bill Gates is the son of a physician as is Mark Zuckerberg; Jeff Bezos’s father owned a bicycle shop (his mom’s second husband was an engineer). None of them were part of the old plutocratic aristocracy but grew up among the 9.9%. We’re always going to have those ultra-rich high-achievers with us. There are only a small number of them. If I were king, there’d be a lot more downwards mobility; the barriers, not just economic but social, to the high-achievers leaving their offspring enough money to be idle should be formidable. But that’s a different subject.
What concerns me is the 9.9%. As documented by Mr. Stewart we control 60% of the wealth and an enormous proportion of the total national income and they’re highly dependent on subsidies. When you combine that wealth and dependence on government with a possibly realistic sense of entitlement and assortative mating it’s deadly to the sort of egalitarian society I’d like to live in and which has been more the norm in American life.
That’s not the only danger we pose. What if Schumpeter was right? Joseph Schumpeter was an early 20th century economist. He coined the phrase “creative destruction” to describe the effects of the capitalist system. One of his most famous claims was that the “intellectual class”, which is what the 9.9% is, would destroy the capitalist system that brought it into being. That’s not a prospect that I think any of us should relish.