The Cascadia Chapter offers this item from the abovementioned for its clear thought.
It so happens that you can determine a huge amount about the economic and social prospects of people in America today by asking one remarkably simple question: how do they get most of their income? Broadly speaking—there are exceptions, which I’ll get to in a moment—it’s from one of four sources: returns on investment, a monthly salary, an hourly wage, or a government welfare check. People who get most of their income from one of those four things have a great many interests in common, so much so that it’s meaningful to speak of the American people as divided into an investment class, a salary class, a wage class, and a welfare class.
Your Intrepid Reporter reminds the assiduous reader that he is of the returns on investment class: one-third of his income is from the interest on his life savings, one-third from his teacher’s pension, and one-third from social security. Two-thirds therefore has to be counted as “return on investment.”
It’s probably necessary to point out explicitly here that these classes aren’t identical to the divisions that Americans like to talk about. That is, there are plenty of people with light-colored skin in the welfare class, and plenty of people with darker skin in the wage class. Things tend to become a good deal more lily-white in the two wealthier classes, though even there you do find people of color. In the same way, women, gay people, disabled people, and so on are found in all four classes, and how they’re treated depends a great deal on which of these classes they’re in. If you’re a disabled person, for example, your chances of getting meaningful accommodations to help you deal with your disability are by and large considerably higher if you bring home a salary than they are if you work for a wage.
As noted above, there are people who don’t fall into those divisions. I’m one of them; as a writer, I get most of my income from royalties on book sales, which means that a dollar or so from every book of mine that sells via most channels, and rather less than that if it’s sold by Amazon—those big discounts come straight out of your favorite authors’ pockets—gets mailed to me twice a year. There are so few people who make their living this way that the royalty classlet isn’t a significant factor in American society. The same is true of most of the other ways of making a living in the US today. Even the once-mighty profit class, the people who get their income from the profit they make on their own business activities, is small enough these days that it lacks a significant collective presence.
There’s a vast amount that could be said about the four major classes just outlined, but I want to focus on the political dimension, because that’s where they take on overwhelming relevance as the 2016 presidential campaign lurches on its way. Just as the four classes can be identified by way of a very simple question, the political dynamite that’s driving the blowback mentioned earlier can be seen by way of another simple question: over the last half century or so, how have the four classes fared?
The answer, of course, is that three of the four have remained roughly where they were. The investment class has actually had a bit of a rough time, as many of the investment vehicles that used to provide it with stable incomes—certificates of deposit, government bonds, and so on—have seen interest rates drop through the floor.
Thank you (as our darker-hued brothers and sisters say).
Still, alternative investments and frantic government manipulations of stock market prices have allowed most people in the investment class to keep up their accustomed lifestyles.
The salary class, similarly, has maintained its familiar privileges and perks through a half century of convulsive change. Outside of a few coastal urban areas currently in the grip of speculative bubbles, people whose income comes mostly from salaries can generally afford to own their homes, buy new cars every few years, leave town for annual vacations, and so on. On the other end of the spectrum, the welfare class has continued to scrape by pretty much as before, dealing with the same bleak realities of grinding poverty, intrusive government bureacracy, and a galaxy of direct and indirect barriers to full participation in the national life, as their equivalents did back in 1966.
And the wage class? Over the last half century, the wage class has been destroyed.
In 1966 an American family with one breadwinner working full time at an hourly wage could count on having a home, a car, three square meals a day, and the other ordinary necessities of life, with some left over for the occasional luxury. In 2016, an American family with one breadwinner working full time at an hourly wage is as likely as not to end up living on the street, and a vast number of people who would happily work full time even under those conditions can find only part-time or temporary work when they can find any jobs at all. The catastrophic impoverishment and immiseration of the American wage class is one of the most massive political facts of our time—and it’s also one of the most unmentionable. Next to nobody is willing to talk about it, or even admit that it happened.
The destruction of the wage class was largely accomplished by way of two major shifts in American economic life. The first was the dismantling of the American industrial economy and its replacement by Third World sweatshops; the second was mass immigration from Third World countries. Both of these measures are ways of driving down wages—not, please note, salaries, returns on investment, or welfare payments—by slashing the number of wage-paying jobs, on the one hand, while boosting the number of people competing for them on the other. Both, in turn, were actively encouraged by government policies and, despite plenty of empty rhetoric on one or the other side of the Congressional aisle, both of them had, for all practical purposes, bipartisan support from the political establishment.