Tag Archives: Managerial Class

A Low-Trust Society Is an Impoverished Society

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By Charles Hugh Smith

Source: Of Two Minds

The sole remaining reservoirs of trust in American life are personal networks, local enterprises and local institutions.

It’s not exactly news that social trust has declined significantly in the United States. Surveys find that public trust in institutions and the professional classes that dominate those institutions has cratered. (see chart below) Social trust–our confidence that other people are trustworthy–has also fallen to multi-decade lows.

This was not the case in decades past. Americans maintained high levels of trust in their institutions, government and fellow citizens. The decline in social trust is across the entire spectrum: our trust in institutions, professional elites and our fellow Americans has declined precipitously.

The causes of this decay of social trust can be debated endlessly, but several factors are obvious:

1. Institutions forfeited the trust of the citizenry by withholding / editing realities to serve the interests of hidden agendas and insiders’ careers. The Vietnam War was pursued on fabrications, as was the second Gulf War to topple Saddam. Watergate eroded trust on multiple levels, as did the Church Committee’s investigation of America’s security agencies’ domestic spying / over-reach.

2. The managerial / professional elites at the top of the nation’s institutions no longer put the citizenry’s interests above their own. The public’s trust has eroded as institutions are primarily viewed as vehicles for self-enrichment and career advancement: healthcare CEOs pay themselves millions, higher education is bloated with layers of non-teaching administration, defense contractors and the Pentagon have greased the revolving door to the benefit of incumbents and insiders, and so on, in an endless parade of self-serving cloaked with smirking PR claims of “serving the public.”

The shift from a high-trust society to a low-trust society is consequential economically, politically and socially. Low-trust societies have stagnant economies, as nobody trusts anyone they don’t know personally or through personally trusted networks, and nobody trust institutions to function effectively or fulfill their stated mission to serve the public good.

Faced with incompetent, unaccountable, corrupt bureaucracies and a culture overflowing with scams, frauds, imposters and get-rich-quick schemes, people give up and drop out. Rather than start a business and accept all the risks just to get dumped on or ripped off, they don’t even try to start a business. Given the financial insecurity that is now the norm, they decide not to get married or have children.

The vast trading networks of the Roman Empire were based on personal trusted networks and trust in Rome’s functionaries / institutions. The owners of trading ships dealt with trusted captains and merchants, who then paid duties to Roman functionaries in Alexandria and other major trading ports.

In other words, tightly bound personal trusted networks work well as long as the state institutions that bind the entire economy are trusted as fair and reliable–not perfect, of course, but efficient and “good enough.”

But when public institutions are viewed as unfair, unreliable, corrupt or incompetent, the entire economy decays. Even personal trusted networks cannot survive in an economy of unfair, unreliable, corrupt or incompetent state bureaucracies and private institutions.

The American economy is now dominated by enormous privately owned and managed monopolies and cartels that are the private-sector equivalent of self-serving state bureaucracies. Big Tech, Big Pharma, Big Healthcare, Big Ag, Big Finance, etc., are even worse than state bureaucracies because there are no legal requirements for transparency or recourse. Try getting a response from a Big Tech corporation when you’ve been shadow-banned or sent to Digital Siberia.

The sole remaining reservoirs of trust in American life are personal networks, local enterprises and local institutions. These are not guaranteed, of course; in many locales, even these reservoirs have been drained. But in other locales, enterprises and institutions such as the county water utility, the local newspaper, the local community college, etc. continue to earn the trust of the public by performing the services they exist to provide effectively and at a reasonable cost.

The larger the institution and the greater its wealth and power, the lower the social trust–for good reasons. The greater the influence of the managerial elites, the greater the disconnect from the everyday experiences of the citizenry and customers, and the more extreme the self-serving PR.

Sure, I trust Big Tech, Big Pharma, Big Healthcare, Big Finance–to rip me off, profiteer, send me obfuscating bills, jack up junk fees, make it impossible to contact them, and send me to Digital Siberia if I complain.

The divide between the elites and the commoners should prompt us to examine the low-trust path we’re sliding down:

In a society in which everything is phony, low quality or fraudulent, you’re taking a chance trusting anyone you don’t know personally–and even that can be risky now that self-aggrandizing flim-flam is the last remaining path to financial security for non-elites.

A low-trust society is an impoverished society, economically stagnant and socially threadbare. That’s where we are now, and the more fragmented, greedy, self-serving, desperate and deranged we become, the lower the odds that we’ll find the means to rebuild trust.

Sadly, we already know that anyone claiming to “rebuild trust” is spouting PR designed to mask self-enrichment. We also know that the vast army of well-paid flacks, factotums, enforcers, happy-story apologists, lackeys, toadies and sell-out minions are declaring “everything’s great!”

Just mumble, “Uh, sure” and continue to Tune in (to degrowth), drop out (of hyper-consumerism and debt-serfdom) and turn on (to self-reliance and relocalizing capital and agency).

Mobility, Meritocracy and Other Myths

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justice-fish

 

By Kevin Carson

Source: Center for a Stateless Society

At the American Enterprise Institute, Mark Perry (“Yes, America’s middle class has been disappearing… into higher income groups,” Dec. 17) justifies the shrinking middle class and growing economic inequality by citing the finding of a recent Pew Institute study that of the 11% shrinkage in the American middle class, 7% have gone to the top and only 4% to the bottom.

First, movement between strata doesn’t legitimize stratification if the structure itself is illegitimate. Meritocracy is a legitimizing myth created to distract people from the question of whether the system of power those meritocratic functionaries serve is just. As Chris Dillow, an unorthodox British Marxist economist, observed (“Beyond social mobility,” Stumbling and Mumbling, Dec. 19):

“Imagine a dictator were to imprison his people, but offer guard jobs to those who passed exams, and well-paid sinecures to those who did especially well. We’d have social mobility — even meritocracy and equality of opportunity. But we wouldn’t have justice, freedom or a good society. They all require that the prisons be torn down.”

Also note that what’s called the “upper class” in the study includes not only the super-rich rentier classes and people in the C-Suites with million-dollar salaries, but also most of the larger managerial stratum. There’s a good reason this stratum has expanded from 14% to 21% of the general population. As David Gordon argued in Fat and Mean, it was the neoliberal decision in the ’70s to cap real hourly wages and shift a greater share of income upwards to rentiers and cowboy CEOs that resulted in increasing internal authoritarianism in the corporation and a need for a larger class of overseers to monitor the (understandably) increasingly disgruntled work force.

And despite the increased income of the managerial classes, the great bulk of them are still salaried employees whose income depends on the ongoing approval of their superiors. That 14-21% of the population is more or less what Orwell, in 1984, called the “middle” stratum (represented in the story by the Inner Party to which Winston and Julia belonged). Here’s how Orwell described the same general type in the corporate England of his day in another novel, Coming Up for Air:  “in every one of those little stucco boxes there’s some poor bastard who’s never free except when he’s fast asleep…”

Not only do these people continue to collect their managerial salary at the good pleasure of the senior oligarchs of the corporate hierarchy, but to even have a shot at that management pay in the first place they’ve got to put themselves in a position of student debt peonage that will likely eat up a major part of that increased income for years (along with a mortgage that means they’ll really be renting their house from the bank into old age). Add to that the long hours middle management types have to work coupled with the endless bureaucratic toadyism and sycophancy required of them, and the ongoing precarity of their position.

Getting back to the issue of legitimacy, there’s also the fact that the functions exercised by most of these managerial types are illegitimate and would be unnecessary absent an exploitative class society. They are, in anarchist anthropologist David Graeber’s famous phrase, “b***s*** jobs.” They exist because the American state, in league with corporate capital, has cartelized the economy under the control of bureaucratic hierarchies many times larger than the point of declining returns in efficiency, and because the authoritarian nature of those hierarchies and the rent-seeking nature of their management creates a conflict of interest that necessitates intensified surveillance and control.

The late Joe Bageant aptly described the nature of the work these people perform: “The empire needs… about 20-25% of its population… to administrate and perpetuate itself — through lawyers, insurance managers, financial managers, college teachers, media managers, scientists, bureaucrats, managers of all types and many other professions and semi-professions.”

When workers own the firm and manage their own work, as in the recuperated enterprises of Argentina, not only can workers be trusted to use their own superior knowledge of the work process but what little coordinating costs remain are a small fraction of U.S. corporate administrative costs. In fact eliminating all those management salaries solved the unit costs problem at one stroke.

The upper quintile is growing in size and income because all the value created by actual productive workers in the lower quintiles gets extracted by those at the top. When the top classes rob everybody else, they need a lot more guard labor to keep their stolen loot secure.

And whether or not there’s been an increase in the real income of the lower four strata, production workers’ loss of control over the work force and increased precarity is even worse than that of those middle managers in the top 21%. Whether for production workers or middle management, stress correlates directly with powerlessness.

We don’t need meritocracy. We need justice.