The Service Class

Having written about the economic problems facing the USA, some might wonder why I haven't yet commented on the latest poverty figures - i.e., that the US poverty rate rose the third year in a row, from 12.1% in 2002 to 12.5% in 2003, while real median household income remained unchanged at $43,318, and the percentage of US citizens without health insurance grew from 15.2% to 15.6%.

The reason was I don't think this is part of the reasons or signs of a coming US economic crisis. Rather, I think this outlines a social downturn (which might well lead to a crisis, or be accelerated by an economic crisis, but that's another issue). That poverty rose while median income stayed flat shows continued, strong polarisation in wealth.

The underlying process is the creation of a new socio-economic class.

Marx taught about the burgeois vs. the worker class and the proletariat, which aptly described advanced industrialised countries in the 19th and the beginning 20th Centuries (other states less so). But 20th Century capitalism - with the New Deal plus post-WWII measures like the GI bill in the USA, and the welfare state in Western Europe - rendered the traditional communist view of society outdated and useless, by creating a middle class majority and a stronger upward mobility (while communist revolutions resulted in the creation of new, cruel elites who proved the proposed cure a disastrously false hope, but that's another issue again).

The problem with a majority middle class is that contrary to the widespread belief, they are not progressive per se: for, as long as most of its relatively well off members erroneously believe they could one day become part of the elite, they won't challenge existing privileges of the elite and will support more, believing one day those could benefit them; and while forfeiting the defense of their own true interests in this way, they can also easily dismiss the problems of the underclass as those are a minority. Members of the middle class can feel progressive based on their stance on a few minor issues, while they are mostly for the status quo.

However, the status quo is always only an illusion of status quo: the slowly adopted system changes, and even the social and economic processes themselves on whose maintenance is insisted upon, transform society. Presently, across the Western world, there is a job cruch in high-wage professions, which I think comes naturally if new industries that don't just replace old ones don't appear and there is no state-run job-subsidizing. Idolising productivity, outsourcing and just plain senseless neoliberalism only accelerates this. At the same time, people are told to, and they dutifully blame the jobless for their own situation, allowing regulations to be continually eased, so that people can be forced into low-wage jobs.

This process started definitely under Reagan and Thatcher, and it has greatly accelerated in the USA under Clinton (that's how his jobless figures fell). In effect, a new large (newly large) segment of US society appeared: people jobbing at McDonalds, Wal-Mart, dialing centres etc. for a few years or months or even weeks before getting fired, or just looking for another part-time job.

The service class.

Future will show whether this segment of society, together with the remains of the worker class and other poor, will approach or even surpass the majority - and whether it will develop a class consciousness like the worker class did in the pioneering days of unions and pre-bolshevism communism.

Whatever happens, even with all my dislike for middle class conformity, I'd prefer Europe didn't follow down this path.