Only conservatism can defend the middle class

Patrick Garry, RenewAmerica analyst

A wide array of issues and controversies dominate the political terrain, but none is as important as the health and future of the middle class. A strong middle class has historically stood as a pillar of American society and constitutional democracy.

It gave America its unique democratic identity in the eighteenth century; it shaped the outlook of the constitutional framers; it sustained a period of economic growth that has been unmatched in human history; and it provided the basis for a social and political system that not only inspired centuries of freedom and innovation, but centuries of order and stability as well.

From John Adams to Abraham Lincoln to Calvin Coolidge to Ronald Reagan, conservatism has been grounded in the middle-class values, institutions, and communities that have defined America and resisted the type of suffocating government centralization that has occurred in so many other countries across the globe.

If there is one single factor that has energized and characterized America, it is the middle class. But for the past decade, the vitality of the middle class has been threatened. And this threat has stirred great public anxiety, fueling an increasingly partisan debate about income inequality. The partisanship has stemmed from the liberal charge that conservatives care only for the rich, regardless of how the incomes and mobility of the middle class may have stagnated.

This liberal attack cuts to the heart of an American conservatism grounded in middle-class values and vitality. And because this attack questions their historic identity and purpose, conservatives must not only answer it, but reaffirm their middle-class commitment – a commitment that seemed to weaken during the Bush presidency, where a focus on foreign policy and income tax cuts that primarily benefitted the wealthy often conveyed the impression that conservatism had lost sight of the middle class.

The struggles of the middle class

The middle class is suffering economic erosion. As discussed in our previous article on income inequality, middle-class incomes and opportunities for mobility have declined, despite a robust stock market that has greatly enriched the wealthy. Not only has the middle class experienced wage stagnation, but the supply of mid-wage jobs has shrunk proportionally more than jobs at the top or bottom. (This decline coincides, for instance, with a continuing decline in the business start-up rate, which has decreased each year from 2010 to 2013.) A polarization or hollowing out of the labor market has eliminated many of the jobs traditionally available to the middle class. The wealthy and highly educated are doing well, and the number of low-wage, unskilled jobs are increasing, as are government benefits to low-income individuals. But the middle class is struggling against the trend of decline.

According to the Pew Research Center, 61 percent of all adults lived in middle-income households in the early 1970s. By 2012, that figure had fallen to 51 percent. Meanwhile, the numbers living in upper- and lower-income households both increased. The middle class share of national income fell from 62 percent in 1989 to 45 percent in 2012, while the share of national income received by upper-income households rose from 29 percent to 46 percent during the same period.

The middle class cannot rely for help on the elite, who increasingly occupy an almost completely different economy than that in which the middle class is struggling. And because the Democratic Party is dominated by these elites, who are largely isolated from the ebbs and flows of the private economy, it no longer represents farmers and industrial workers dependent on private-sector economic growth. Moreover, the private sector worker has been replaced in the Democratic Party by the public sector unions, which are more interested in expanding government than expanding the economy. Consequently, liberals have lost sight of the basic need for economic production, presuming that money just results from certain professions and that tax revenues just appear because they have been set in law. Economic production – the anchor and output of the middle class – has been downgraded vis a vis government.

In many communities, the elite are withdrawing from the social institutions and venues relied upon by the middle and working classes. Indeed, in this age of globalization, the elites have more in common with their counterparts in other countries than they do with the middle class in America, as reflected in the elitist disdain for the values of patriotism and military service.

The implications of this social polarization are ominous. As Aristotle observed more than two millennia ago, middle-class dominated societies are the most stable, just, and compassionate ones. Aristotle argued that the wealthy tend to be arrogant and reckless, and that the economically insecure tend to be resentful and destructive. But members of the middle class tend to have more moderate desires, be more open to reason, and have stronger communal ties and civic participation. Similar observations were made by Christopher Lasch in The Revolt of the Elites, in which he argued that the social elites were undermining America's republican vitality with their asocial cultural values and absence of civic responsibility.

Aside from the economic threat to the middle class, globalization and the increasing centralization of government power further erode the independence of the middle class. With globalization, more economic decisions affecting local communities are being made in some multinational corporate boardroom. And with the extension of federal power into more and more areas, political decisions once made in local middle-class communities are now being made in Washington, DC.

The liberal abandonment of the middle class

The Left long ago abandoned the middle class in favor of a cultural and political elite. Democrats, for instance, claim that they are the party of the average person, but the evidence clearly rebuts this claim. In 2012, seven of the ten richest counties in America voted for President Obama, and seven of the ten richest congressional districts are represented by Democrats. And as they have come to represent the rich, Democrats have grown rich in their political coffers, with Democratic congressional campaign committees outspending their Republican counterparts.

Democrats have become the party of the super-rich, from George Soros to Goldman Sachs executives to Hollywood moguls. Big segments of America's controlling elites – academics, journalists, trial lawyers, Wall Street barons, and media personalities – have become dominant within the party.

Although working-class employees have seen their payroll deductions increase during the Obama era, private-equity partners who make billions have enjoyed much more favorable tax treatment. Due to the carried-interest exemption, the incomes of these Wall Street titans are treated as capital gains, and hence taxed at a significantly lower rate than are wages. But that's not the only way these wealthy financiers benefit. Social Security and Medicare taxes apply only to wages and salaries, not capital gains distributions. Thus, hedge fund managers not only have their income taxed at less than half the top marginal rate, but they also escape payroll taxes.

Even the leftist activists come from money. A study conducted by sociologists at the City University of New York on the participants in the Occupy Wall Street protests showed that more than a third of the protestors were from households with an income of more than $100,000, and almost three-quarters of the protestors were employed in professional occupations.

Cultural liberalism and the attack on middle-class values

Through the influence of the cultural elite, the Left has turned further and further away from the middle class. Leftist attitudes resemble those held by nineteenth century European nobility – a disdain for the mundane materialism of the middle and lower classes, with their religious enthusiasms and their supposed vulgar interests in making money and advancing themselves. In The Revolt Against the Masses: How Liberalism Has Undermined the Middle Class, Fred Siegel argues that the essence of liberalism has always been snobbery, and that the enemy of liberalism is the middle class and its views of capitalism and shared democracy. Siegel's analysis is reminiscent of Christopher Lasch's The New Radicalism in America, which depicted how early 20th century progressives rejected the middle class values of American culture – a rejection that escalated during the 1960s cultural rebellion against anything seen as "establishment."

The Democratic Party has become the political agent for undercutting many of the centuries-old middle class values of which the elite wish to be free. It has also become the advocate of more centralized government, which, under the control of the political elite, becomes a tool for wresting power from a middle class that for so long has resisted control by the elite.

Cultural liberalism has been the elite's means of seceding from middle class America. In the way it has promoted full abortion rights, for instance, liberalism has eroded such historic social institutions as God-ordained religion, which has always been under the province and direction of the middle class. And the weakening of religion is essential to the rich, who often chafe against any outside constraints on their lifestyles. Indeed, wealthy liberals have promoted a rights agenda which undermines the social authority of cultural institutions whose authority traditionally extended even to the wealthy. But this rights agenda, which incidentally costs the wealthy nothing in terms of taxes, does not help the poor or the working classes; it is primarily a tool of the wealthy to break free of middle-class constraints.

The Left's rejection of historical American culture and its dismissal of American exceptionalism reveals itself in a hostility toward the middle class, which has largely defined American culture. This in turn leads to a desire to remake America according to some utopian leftist vision – a desire evident in Barack Obama's exultant pronouncement just before his election: "We are five days away from fundamentally transforming the United States of America."

The Left, as it did in the 1960s and continues to do throughout the Obama era, seeks to wipe away a past largely shaped by middle class influences so as to recreate society in its own image. But the new rules of political correctness form a cultural establishment far more extensive and intrusive than the old rules. And these new rules reveal that the Left never stood for an establishment-free world; it just didn't want the middle-class establishment.

Conservatism, unlike liberalism, favors reality over utopia. It prefers step-by-step social improvement, instead of erasing the old social order in favor of a new government-mandated one. Conservatives have an allegiance to society as it has developed out of the past, seeing the legacy of history as filtering out a lot of irrational and unworkable experiments that have opposed the existing social order merely because it didn't begin with and center upon the present generation of elites.

The cultural rebellion waged by the Left has had a devastating impact on the social order. The breakdown of the rule of law has been prevalent, leading to so many increases in crime that we no longer even try to prosecute many of them. But this breakdown does not hurt the rich, who live in well-protected cocoons of safety. It hurts the working and middle classes, who now must pay for the elite's refusal to be subject to what are seen as middle-class rules.

The political role of the middle class

The Left talks idealistically about the democratic role of the common person – about how, in a democracy, there is no greater authority than the common person. But this is not how the Left really acts. An incident from the 1952 Adlai Stevenson presidential campaign illustrates the point. When told by a supporter, "You have the vote of every thinking American," Stevenson is said to have replied: "That's not enough, we need a majority."

This same attitude was revealed sixty years later when Dr. Jonathan Gruber, a liberal academic and architect of Obamacare, explained the strategy for passing the Affordable Care Act:

"Lack of transparency is a huge political advantage. And basically, call it the stupidity of the American voter or whatever, but basically that was really, really critical for the Act to pass."

As it turned out, the average American voter turned out to be much more correct in their suspicions about Obamacare than was the administration, which ended up being proven wrong on just about every promise or representation it made. Of course, this is not all that surprising, since Obamacare was yet another dreamed-up utopian scheme that had no basis in reality or historical experience.

Ever since the Progressive and New Deal eras, the Left has advocated a government-by-experts. This approach follows the example of Europe, where a cabal of experts and intellectuals claim a higher authority over the middle class to dictate economic planning and social regimentation.

The liberal preference for experts over the democratic process can be seen in the way President Obama has frequently shunned congressional will and issued presidential fiats that modify or suspend laws previously passed by Congress. It can also be seen in the vast regulatory power given, for instance, to the Independent Payment Advisory Board by the Affordable Care Act, which gives the Board sweeping authority to regulate everything from treatment availability to the prices of medical services. The Board, consisting of 15 persons, all of whom are appointed by the President, is not subject to open meeting laws or notice and comment procedures. Furthermore, its recommendations automatically become law unless Congress acts to stop them. And finally, the Board's decisions are not subject to judicial review. Thus, as the governing centerpiece of Obamacare, the Board possesses an unprecedented level of bureaucratic control unchecked by the legislative or judicial branches.

The huge labyrinth of the administrative state is built upon the belief that only experts can adequately govern this country – a belief that makes liberals resist giving choices to the average person through school choice programs or health savings accounts. In the liberal mindset, the average person serves not as a sovereign voice within American democracy, but as a dependent client of government – someone to justify the growing power of government agencies. The individual is not to act, but to be acted upon.

A deepening dependency and the erosion of the middle class

In part because of its independence, the middle class has played a vital role in the nation's longstanding political and economic development. Politically, the middle class has exerted a stable and guiding force, free from the dictates of controlling elites or the desperation of need. It has injected a rational and moderating influence in what could have been a chaotic political process ping-ponging between the extremes. Economically, the middle class has possessed enough independence to prevent it from being corrupted or co-opted by the governing or economic elite. This independence has given it the ability to act as the innovative and production engine of the U.S. economy.

But the independence of the middle class has not been simply a materialistic independence, such as the wealthy might have through inheritance. Instead, it has been an earned independence that has in turn reinforced the crucial middle-class values of initiative, prudence, thrift, and foresight. But though independence is crucial to the integrity and authority of the middle class, the Left has acted to put the middle class in a dependent role, using the growth of government to turn non-elite individuals from sovereign electors to dependent government consumers.

Often, government has justified its own growth on the need to control the power of large or oligopolistic corporations. Thus, big government power and big corporate power exist in a kind of dependent alliance, each feeding off the other. Through big political contributions, big corporations can influence government; and by regulating big business in a way that fends off potential competitors, big government preserves big business and ensures the continual flow of campaign contributions.

Liberals claim that big government programs help the middle class, but cronyism and clientelism often corrupt those programs, channeling benefits to the well-connected and away from the middle class. Take, for instance, the recent farm bill. Most family farmers don't want it, and there was a populist revolt against it in Kansas, but wealthy farmers and large agribusinesses used their lobbyists to push for it. Then there is the Export-Import Bank, which has funneled billions of taxpayer dollars to big corporations with strong lobbying operations. This is why conservatives need to limit the reach of government in ways that protect and advance the middle class.

Their stance on voting laws presents another example of how liberals downgrade individual independence. An essential element of independence is responsibility. If responsibility is eroded, so is independence. And a primary responsibility of any citizen is to vote. But by fighting against voter-ID laws wherever they are considered, liberals convey the message that there should be less responsibility required of a person seeking to vote than of one buying a six-pack of beer or checking into a hotel.

The framers saw the middle class as being the anchor of American democracy and the democratic progenitor of civic virtue – how ironic, then, that the Left resists any democratic measures meant to prevent the kind of well-documented voter fraud recognized by the Supreme Court in a 2008 opinion stating that "not only is the risk of voter fraud real," but that "it could affect the outcome of a close election." Similarly, a study based on survey data from the Cooperative Congressional Election Study found that 6.4 percent of all noncitizens voted illegally in the 2008 presidential election.

Beyond just shrugging at the prospect of voter fraud, liberal activist groups often encourage it, as revealed in the recent Greenpeace incident, where an employee of the group was found voicing approval of absentee-ballot theft and fraudulent voting. And in March of this year, Rev. Al Sharpton and other liberal activists at a Cincinnati "voting rights" rally celebrated Melowese Richardson, who was convicted of voter fraud after using her position as a poll worker to vote numerous times in the 2012 presidential election.

Policies of dependence

Work is the pathway to the middle class, and independence is the hallmark of the middle class. But liberal policies often enhance dependency. Liberals resist giving the middle class control over their Social Security accounts, despite the fact that the Social Security system run by the government is going broke. They resist giving individuals control over the structure of their health care, even though nearly every assurance made by the government concerning Obamacare has proved false. They resist giving families their choice of schools, even though the public schools assigned to their children are themselves failing. Liberals even resist the work requirement in welfare, even though work leads to independence. Conversely, eliminating the work requirement only expands dependency.

The Left does not seem to value the independence of the middle class, perhaps because the middle class has never bought into the utopian radicalism of the Left. Consequently, liberal policies often exert a depressing effect on work. Earlier this year, the Congressional Budget Office announced that Obamacare's disincentives on work will wipe out more than 2 million full-time jobs. Moreover, these disincentives are not geared toward the sick, the elderly, or the disabled, but toward working-age able-bodied adults, who will be pressured to choose government dependence over self-reliance. This is another example of how an ever-expanding government seeks to turn people from independent workers into dependent clients. But this is hardly compatible with the kind of authentic citizenship envisioned by the framers, since dependency degrades the capacity of the citizenry to operate as a check on government.

Government programs often just sustain low-income people in their current status, rather than help them get back on their feet and advance. Programs intended to be "work supports," such as housing assistance, Medicaid, and Food Stamps, too often benefit individuals not in the labor force, instead of supplementing the earnings of people working at low wages or limited hours. The food stamp program (SNAP), for instance, appears to allow a significant number of adult recipients to remain out of work longer than they might otherwise. Without some effort to require SNAP recipients to participate in employment programs, the number of non-working, nonelderly, nondisabled recipients will remain high, keeping these families poor and denying them the springboard to the middle class.

Current immigration policies have been particularly skewed against work and the middle class. The Obama administration has been reluctant to grant immigrant visas to people with job skills in high demand. Instead, the focus is on the unskilled, illegal immigrants who are much more likely to become clients of the government social welfare system. The Obama immigration policy, by focusing on the unskilled, has greatly expanded the ranks of the poor; whereas, for instance, Australia's more selective immigration policy has tended to reduce them.

The goal of immigration policy should be to increase the ranks of middle-class economic producers, not to expand the ranks of government consumers. But eligibility requirements for a range of social welfare programs – cash welfare, food stamps, disability, Medicaid, etc. – discourage work. (Most means-tested welfare programs do not even require the recipient to be a citizen.) When people voluntarily come to the U.S., it is not unreasonable to expect them to survive without public assistance or else return to their native countries. But surprisingly, the poverty rates for immigrants are higher than for natives. In 2011, 20 percent of U.S. immigrants lived in poverty, compared with 13.5 percent of natives. This contradicts the 1996 welfare reform goal of encouraging immigrants to be self-sustaining and deterring immigrants who were not likely to survive without public assistance.

Something is wrong when people voluntarily come to the U.S. to live in poverty. Why, if they find themselves on the lowest rung of the economic ladder, wouldn't they return to their native country, especially since the cost of living in the U.S. is most likely higher. One answer is that when immigrants become eligible for benefits, they are guaranteed living standards substantially higher than what would be available back home, even if they are unemployed here.

A middle-class policy approach

A better policy approach for the middle class would not be to just add them as another dependent client of another federally-designed program that primarily benefits the bureaucrats administering the program, but to give them more power to direct their own lives. This could be done through a bigger child tax credit for struggling families, a payroll tax cut to boost employment and employee income, an expanded earned-income tax credit to raise wages at the bottom, and health savings accounts that roll over unspent money.

Conservatives want to help the unemployed rise up to the middle class in a way that lets them become independent, rather than in a way that permanently expands government. One way to do this might be to provide relocation assistance for those who could find a job in some other area, or provide better transportation assistance within metropolitan areas, so as to shorten commute times from low-income neighborhoods to job sites.

© Patrick Garry