America Doesn't Have Social Classes

August 3, 2010 9:29 AM

"[Bank robber Peter Barry] Lawrence, 71, made his getaway in his wheelchair, with $2,000 in cash on his lap... he took a meandering route down Seventh Avenue until the police caught up with him five minutes later. But that was all part of the plan." And an embedded reporter in Afghanistan notes that "many young soldiers told me that they actually live better in the army, even when deployed, than they did in civilian life, where they couldn't make ends meet, especially when they were trying to pay for college or raise a family by working one or two low-wage jobs" (p. 1). Meanwhile, "parents of means are now resorting to buying franchise businesses to keep their adult children employed." Economic life in contemporary America.
posted by rkent (48 comments total)

I wouldn't think parents investing in their child's business is anything new. Anecdotally, this has been common practice in the restaurant industry for years.
posted by elwoodwiles at 9:37 AM on August 3, 2010

But that was all part of the plan. ... just a desperate ploy to get back behind bars ... He pleaded not guilty
I'm not an expert at getting thrown in prison, but I think you're doing it wrong.
posted by sanko at 9:37 AM on August 3, 2010

Oh, anecdotes. Is there nothing you cannot prove?


'cept maybe the second one, but that shouldn't be surprising, should it? Military service more stable than fevered scrounging?
posted by el_lupino at 9:38 AM on August 3, 2010 [10 favorites]

sanko - the US justice system punishes people for contesting charges with longer sentences. Since it was obvious he was going to be found guilty he was just taking measures to insure he went away for the rest of his life.
posted by ChrisHartley at 9:39 AM on August 3, 2010 [1 favorite]

Great post Hamilton Nolan but you forgot the #recessionomics tag.
posted by 2bucksplus at 9:44 AM on August 3, 2010 [1 favorite]

The stuff about franchise businesses is interesting. I read an article two or three years ago about how many MBAs go on to own, say, three KFC locations. It's not as highfalutin as some other careers - you don't get to drink scotch in your corner office while talking financial gobbledygook - but it's probably a much better investment than most graduate degrees, especially in this economy.

It's not surprising that people would run franchise businesses. It's surprising that people find it surprising: people imagine that those jobs are only for immigrants, or that those jobs were only glorified food service positions.

Also, I would imagine that franchise restaurants would have a much better chance of continued success than a brand new restaurant (or most other new businesses).

Reminds me of the time I discovered how much managers at a certain drug store chain made. More than most lawyers. I'm more than fine with this, but it's funny how, if you described those two people to most middle-class people, they would assume the reverse.
posted by Sticherbeast at 9:48 AM on August 3, 2010 [2 favorites]

Medical care in California’s prison system has been undergoing changes ever since a federal court ruled in 2002 that the state of the health care program was essentially cruel and unusual punishment under the U.S. Constitution.

So, prisoners used to have better insurance than unemployed non-criminals (i.e., none), but even that wasn't considered humane enough by prison standards. So now the unemployed have even worse than cruel and unusual health care, by California standards at least.

That is fucked up.
posted by Civil_Disobedient at 9:49 AM on August 3, 2010 [13 favorites]

I'm kinda dubious about the franchise method of keeping your offspring gainfully employed. While a franchise restaurant probably has a better success rate than your average restaurant start-up they generally have much higher start-up costs and less flexibility (since you are buying from a corporation with a fixed menu most likely).

Unless your kid has a lot of experience working in the restaurant trade it seems like a pretty dubious investment. Restaurants offer a lot of challenges to a novice manager that probably don't exist in other venues. Seems like a remarkably easy way of wasting a hundred grand or so (+plus whatever salaries + wages, rents, and food costs are). Basically you are buying them two years of work experience as a manager.

It seems like it would be better to have them do an extended series of unpaid internships during which you are paying all their living expenses. Lower costs and a better return on investment.
posted by vuron at 9:50 AM on August 3, 2010 [2 favorites]

"many young soldiers told me that they actually live better in the army, even when deployed, than they did in civilian life, where they couldn't make ends meet, especially when they were trying to pay for college or raise a family by working one or two low-wage jobs"

This is also part of the plan.
posted by DU at 9:51 AM on August 3, 2010 [8 favorites]

With all due respect, this is a tendentious and poorly-framed GYOB type of post. The stories that you have cobbled together don't really seem to have much in common, and in many ways contradict the apparent point of this post.

The first is an anecdote about a 71-year old with a bunch of medical problems who hatched a scheme to get arrested and sent to prison. But as the story indicates, he "has been getting his health care for free via Medicare and Medi-Cal." The main reason he wants to go back to prison seems to be that he is having trouble getting around in his wheelchair. So this particular story does not appear to be the indictment of the American HC system that you think is.

The second story, while it does contain the line about many soldiers living better in the army than in civilian life, also talks about how many (older) soldiers have fulfilling jobs and families and just want to go back home. So, again, its a nice anecdote but it isn't exactly evidence that droves of Americans are being driven to enlist because of economic hard times.

The third story is actually about how many parents are choosing to buy businesses for their children instead of sending them to college:"However, evidence is mounting that more and more parents are beginning to rebel at paying the ever-soaring tab for higher ed, with a study recently released by Countrywide Financial finding the number of moms and dads who say college is a good investment in their child’s future earning potential has dropped dramatically since 2008."
posted by googly at 9:54 AM on August 3, 2010 [7 favorites]

Actually, it's not clear whether franchises succeed better than independents.
posted by dirigibleman at 9:56 AM on August 3, 2010

Great post Hamilton Nolan but you forgot the #recessionomics tag.

The way we live now: Brandishing BB guns and forgetting our tags.
posted by dirigibleman at 9:56 AM on August 3, 2010

“I guess I bought her a job,” says her father, Jan Walther

Or, you started a new family business that -- hooray -- you can pass to your children.

Kinda sounds like the fucking definition of the American dream.

And this is a problem because ... ?
posted by Cool Papa Bell at 9:57 AM on August 3, 2010

I wouldn't think parents investing in their child's business is anything new. Anecdotally, this has been common practice in the restaurant industry for years.

See: George W. Bush.
posted by mrgrimm at 9:58 AM on August 3, 2010

Kinda sounds like the fucking definition of the American dream.

Which American dream? The one where everyone is created equal?
posted by mrgrimm at 9:58 AM on August 3, 2010

Or what googly said. Randomly strung news and trends collected as "life in wartime."
posted by mrgrimm at 10:00 AM on August 3, 2010 [1 favorite]

Oh, I get it. It's a problem because she was enrolled as A FASHION DESIGN MAJOR AT A UNIVERSITY IN OHIO.

Nothing against Kent State fashion design majors. Just be prepared for some dues-paying. Kent State != hip boutique in Williamsburg.

Poor choices happen in great economies, too.
posted by Cool Papa Bell at 10:01 AM on August 3, 2010 [2 favorites]

We need to find life on other planets ASAP so that we can eliminate all jobs not related to Manifest Destiny and just start this Imperial Dominion rolling for realz.
posted by spicynuts at 10:01 AM on August 3, 2010

Which American dream? The one where everyone is created equal?

No, the one where you can still start a business in a bad economy.

You know, the point you swung at and missed.
posted by Cool Papa Bell at 10:02 AM on August 3, 2010

You know, O'Henry used this theme long ago, in very different economic times.

Twenty years ago, too, in very different economic times, I handled a brutal gang rape case. The victim, a homeless Native American woman, found it hard to accept the idea that a long period of incarceration for her rapists in a safe warm place with 3 meals a day could actually be viewed as punishment.

I cannot say this post persuades me of much of anything.
posted by bearwife at 10:05 AM on August 3, 2010 [1 favorite]

No, the one where you can still start a business in a bad economy.

I think you're missing the point. I'm certainly not crying for the kids whose parents are buying them a franchise to run. But if the children of people who can afford to do that don't have any other options, the children of people who can't (that is, the overwhelming majority of people) are probably not doing so well.
posted by enn at 10:07 AM on August 3, 2010

The stories that you have cobbled together don't really seem to have much in common, and in many ways contradict the apparent point of this post.

The point is the contrast between what people at the lower end of the socioeconomic spectrum are willing to / need to do to get by, vs. what super rich people can afford to do for themselves and their families. And as for the suggestion that this guy was doing fine because he had Medi-Cal, well... I've known people with Medi-Cal coverage and it is no European socialist medical utopia. It's backstop insurance that might cover part of your bills if Medicaid leaves you in a lurch, with coverage and reimbursement rates fluctuating wildly as the California budget crumbles.

One link I should've added as a "more inside" or something (but which slipped my mind) is "Do the Rich even Need the Rest of America Anymore?" - about the perceived decoupling between the super-rich and everyone else in this country. And Cool Papa Bell, I'd say this perception - and the actual decoupling, to the extent it can be sustained - actually subvert the American Dream more than anything else. I always thought it was about pulling oneself up from one's bootstraps, not building and protecting a massive set of assets such that your kids never have to work for theirs.
posted by rkent at 10:20 AM on August 3, 2010 [4 favorites]

But that was all part of the plan.

You'd think none of these people had ever heard of O. Henry's 1904 story The Cop and the Anthem about a bum who is trying his darnedest to get thrown in jail, in order to enjoy the amenties. And at what point in human history have volunteer armies and navies not been composed mainly of men who enjoyed a better quality of life under arms or at sea than in civillian life? And when have parents of means not wanted to do kindly but probably-not-good-for-their-characters things for their children?

The subhead here mentions social class ... There may be news items out there that demonstrate the life in the United States is a living hell, where half-starving people gather in mobs at the doors of hospitals desperately trying to claw their way into the overcrowded emergency rooms, and where the spoiled children of obscenely wealthy Wall Street bankers drive through ghetto streets in their Hummers laughing and running over the children of the poor, where starving men with rags hanging off their backs line up at enlistment stations to be clamped into chains and forced to man the galleys in the Red Sea, and where poverty is so widespread that yuppies must hold perfumed hankies to their noses as they climb over the dead bodies of expired job seekers on their way to do-nothing jobs in air-conditioned office buildings, where life is such an unspeakable riot of suffering that millions of Americans are desperate to emigrate to any country anywhere -- but these articles ain't them.
posted by Faze at 10:21 AM on August 3, 2010 [2 favorites]

Faze is right. Everything is rosy out there.
posted by vibrotronica at 10:27 AM on August 3, 2010

The fantasy of a vast upper middle class:

The result has been an experiment in social engineering that has gone horribly wrong: the creation of a faux mass upper middle class. Millions of Americans who by objective standards belong to the working class or lower middle class have persuaded themselves that they are part of the professional-investor elite, because they have worthless degrees from diploma mills, negligible amounts invested in stocks, and suburban trophy houses they cannot afford. For the college graduates at Starbucks working to pay off student loans for degrees that they will never use, as for the millions of Americans who are now "underwater," owing more on their mortgages than their houses are worth, the American dream has turned into a nightmare.

posted by enn at 10:34 AM on August 3, 2010 [8 favorites]

How does

1. prison providing a better standard of living than life outside with no social welfare
2. military service providing an escape from poverty
3. rich parents buying their kids businesses to run

demonstrate that social class doesn't exist in the United States?

Maybe "class" doesn't mean what you think it means.
posted by clarknova at 10:34 AM on August 3, 2010

I think rkent was being ironic to make a point, clarknova.
posted by Sticherbeast at 10:38 AM on August 3, 2010

Conservatives only seem like they're complaining when they talk about how prisoners live better than the average American. They're really being egalitarian when they try to send as many Americans as possible to prison.
posted by Eideteker at 10:47 AM on August 3, 2010 [3 favorites]

Crap, I just saw an article online yesterday - I think in an economics blog - where the theme was that in America you are for less likely to change your socioeconomic status now than you are in most other developed (and largely socialist) countries. More irony for tone-deaf anti-socialists who chant "America is the greatest nation on Earth" as if repeating it over and over makes it true.

Here is a link to Ezra Klein's post on American income mobility. It's not the link I was looking for and is far less detailed. The chart referred to here indicates that Italy and Great Britain have less income mobility than Americans, but the general trend is consistent with what I recall reading. Klein's post has some links to further study (which I have added in this sentence, to make them a little easier to locate).
posted by Xoebe at 10:50 AM on August 3, 2010 [5 favorites]

rkent:
One link I should've added as a "more inside" or something (but which slipped my mind) is "Do the Rich even Need the Rest of America Anymore?" - about the perceived decoupling between the super-rich and everyone else in this country.

The only thing worse than the repeated use of the phrase 'banksters' was the comments section.
posted by paisley henosis at 11:22 AM on August 3, 2010

But if the children of people who can afford to do that don't have any other options...

Well, option 1 was "not studying fashion design in college."

It's not great out there. But using this as an indicator of not-great-out-there is hokum. This person had enough means to attend a rather nice college and enter into a course of study for which high-end success is found few and far between. When things didn't turn out well, her family took her time and (meager) talent, married it to their money and opened up a new line of business for itself.

It's a good thing that they were able to do all of this. Not a smart thing to end up having to do. But a good thing. In other countries, her options were "go on the dole" or "dead-end job." Instead, she's running a business. Good for her. Good for her family. Good for ... sob ... America!

small hamburger

You poor kids looking at college as a way out? Don't study fashion design. Study engineering. Medicine. Accounting. Something with a career path.

Work hard so that your kid has enough leisure time to go make new and unique mistakes.
posted by Cool Papa Bell at 11:31 AM on August 3, 2010

In other countries, her options were "go on the dole" or "dead-end job."

I'm pretty sure the children of the rich have more options than that in pretty much every country.
posted by enn at 11:34 AM on August 3, 2010 [3 favorites]

The funniest thing about Faze's blistering rejoinder is this:

And at what point in human history have volunteer armies and navies not been composed mainly of men who enjoyed a better quality of life under arms or at sea than in civillian life?

I mean, how easy would it be to write a pacifist/socialist manifesto with that as your opening sentence? Yet to Faze, it's a good thing that enough poverty exists to make people want to kill and risk being killed for a living. Because...Faze thinks that no one would go into the military if they had a better option? That it's poverty that feeds our ability to make constant war, and prosperity for all would be a threat to that ability?

Talk about tipping your hand.
posted by emjaybee at 11:43 AM on August 3, 2010 [9 favorites]

Yeah, how dare the woman in the article pursue happiness by choosing a career path that best suited her talents and interests? This is America!
posted by vibrotronica at 12:37 PM on August 3, 2010 [2 favorites]

Tangentially related, but apparently, at least some are finally willing to acknowledge America does indeed have social classes. Two of them, in fact: 'Us' and 'Them':

Mort Zuckerman: If Obama Isn't Nicer to Us Rich People, We Will Destroy America
posted by saulgoodman at 12:53 PM on August 3, 2010 [2 favorites]

Financial Times has a pretty good article that sums up what it means to be "middle class" today
posted by codacorolla at 1:43 PM on August 3, 2010 [4 favorites]

Cool Papa Bell, you clearly don't know much about the fashion program at Kent State -- I've had a number of interns from there, worked with people who went there, etc. It's actually a very well-respected program. The majority of graduates are not going into design positions, they're going into merchandising & buyer positions in a 5-billion-dollar-plus industry. And the national average salary for buyers is around $50,000 -- nothing to sneeze at!

Just because you don't think there's a career path involved doesn't mean you're right...the snide comments about "meager" talent being the reason this girl is unable to find a good job right now is unfair. Plenty of engineers and accountants, to use your "acceptable job choice" examples, are out of work too.
posted by bitter-girl.com at 2:11 PM on August 3, 2010 [10 favorites]

emjaybee -- You seem to have gotten the wrong impression. I am a pacifist and oppose all wars and armies. But that is entirely beside the point I was making, which is that poor people seeking to better their lots by enlisting in the army is hardly an historical anomaly, but is in fact the usual state of affairs.
posted by Faze at 4:02 PM on August 3, 2010 [1 favorite]

Just for the record, Kent State has a top tier fashion design program.
posted by nowoutside at 6:27 PM on August 3, 2010 [1 favorite]

hardly an historical anomaly

This is true; even going back to Roman times, one of the ways for a non-Roman to become a full-fledged citizen was military service.
posted by Civil_Disobedient at 6:36 PM on August 3, 2010

There is a question this and a lot of other threads have been leading me towards lately- does a technologically advanced civilization need a middle class?

If a powerful person who wants to get things done in the real world, (ie sell a company or dam a river) they are going to deal with other powerful people (who are in the upper class) and the government. Other upper class people have the power to get whatever you want done. As long as there's private property, there will be demand for the upper class.

It could be that the middle class invented and organized it's way into obsolescence. We've got automation technology or outsourcing to extremely cheap labor for all those expensive middle class, artisan type positions such as machinist or engineer. The upkeep costs of a large middle class are high, so it could be that the demand for a middle class is decreasing, and we're seeing this in median wage stagnation.

The general stability of society is threatened if the middle class ceased to exist. And at least based on my understanding of Keynesian Economics, eliminating the middle class would drop aggregate demand, and hurt overall economic output. However, these arguments have no bearing on the decisions that are killing the middle class. You don't think about what it would do to democracy when you eliminate a dozen median income jobs, you think about what it does to the financial standing of your business. If you can get by with lower class labor, as a business owner you'll chose to.

I guess if there isn't a demand for the middle class in the U.S. as civilization moves forward, we're going to have to fight for it politically.
posted by nowoutside at 8:04 PM on August 3, 2010

Faze thinks that no one would go into the military if they had a better option

I'm a bit confused by this. If you had a better option, why wouldn't you take it? How are we defining "better option"? Should people be rejecting better options to take up arms?

Admittedly, I don't live in a society as militarised as the US, but the only soldier I know joined up precisely for the pay and training. It turned out that he enjoyed driving trucks around East Timor more than working in a call centre, but that was only worked out after the fact... the original decision was pretty much a direct invisible hand/homo economicus self interest deal.

How else should one populate a volunteer army? White feathers?
posted by pompomtom at 8:26 PM on August 3, 2010

My second job ever (in high school) was at a frozen yogurt joint. The owner/manager was an early 30-something whose daddy bought her the place and -- predictably -- it was a disaster.

I mean, I got to give free yogurt to all of my friends and almost got laid in a walk-in freezer (worth a try, but impossible I'm afraid) but daddy didn't get much on his return. Place shut down after about two years.

It is strange to think this might be happening more often though. Then again, when I went to college in the 90's and grad. school in the early naughties I was pretty shocked at how many parents were buying houses for their kids so they could have a place to stay for four years, then they could flip the place and make hundreds of thousands of dollars.

We know how that worked out as well.
posted by bardic at 11:09 PM on August 3, 2010

I second the FT article from codacorolla. A really good, interesting and scary read.
posted by DanCall at 1:23 AM on August 4, 2010

then there's this piece from CNNMoney, where someone wants to know how s/he can put together $1M by age 65 (age 28 now).

Answer: Save at least $650 a month from now on and invest well enough to get at least 6% return, and don't do nuthin' stupid.

Also remember that $1M in 35+ years will be like $400K in today's dollars.

Good luck, sucker.
posted by toodleydoodley at 2:54 PM on August 4, 2010

There is a question this and a lot of other threads have been leading me towards lately- does a technologically advanced civilization need a middle class?

It does, but technology has allowed that middle class to be outsourced.

There's a huge and growing middle class in China and India, which got its start in large part serving the U.S. market. All that labor-intensive, middle class manufacturing that used to be done in the U.S. but now isn't; it's driving the creation of a middle class on the other side of the planet.

My feeling is that it's probably too late to do much of anything about this. At some point in the past, maybe as recently as 10 or 15 years ago, we might have been able to essentially dictate trade terms to China and other developing economies, since we represented such a vast market. Such protectionism would have resulted in higher goods prices, but also might have preserved much of the middle class here. Instead, for reasons that I suspect historians will be trying to suss out for generations (and which I think involved Cold War politics as much as economic dogma), we decided against that path.

In retrospect I think it's going to turn out to have been a Faustian bargain; we sold the decades-long headstart we had versus the rest of the world after World War II, and which we could have milked for generations, for basically one generation's worth of exceptional prosperity. What we're seeing now is the beginning of a new phase, which involves direct wage competition between American workers and their Chinese and Indian counterparts, and as far as I can tell involves an unavoidable decline in standards of living and real wages in the U.S. as equilibrium is reached.
posted by Kadin2048 at 2:57 PM on August 4, 2010 [3 favorites]

There is a question this and a lot of other threads have been leading me towards lately- does a technologically advanced civilization need a middle class?

No civilization needs a middle class. I think large middle classes are a rarity throughout the history of western civilization. The more common state of affairs is where you have a large working/peasant class, a smaller class of elites, and an even smaller mercantilist class of tradesmen between them. There are three periods I know of where the middle class has been large - the Rennaissance (brought on by labor shortage after the plagues), the time around the American Revolution ( somewhat labor shortage combined with large supply of land ), and the post WWII period ( don't know what caused this... America dominating world trade leading to a domestic shortage of labor combined with labor friendly government policies? ).

Large middle classes simply do not occur naturally. You either need to get lucky, or fight politically for strongly redistributionist policies.

Will America's Middle Class Soon be Extinct?

“Human Directionals”—The Cheap Wage/Expensive Land Economy Personified
posted by heathkit at 3:17 PM on August 4, 2010 [2 favorites]

heathkit: The second you link you posted comes from VDARE, a thinly-veiled (if at all veiled!) racist anti-immigration site, and is written by an author with frankly racist views.

Look at some of the quotes from the article:

Sadly, immigration has created a wasteful abundance of cheap labor and contributed to a shortfall of cheap land.
...
With American teenagers increasingly driven out of traditional jobs, such as fast food, by employers' preference for a staff that speaks a common language (i.e. Spanish)

Translation: "Teh darkies are taking our land and jobs!!!!!!!1111"
posted by dhens at 9:19 AM on August 7, 2010