I grew up in a none-too-elegant part of New York City, and when I finally got solvent and moved to a nice suburb, on occasion I would imagine a march of poor people, pouring out of Cambridge and walking up Belmont Hill with pitch forks and clubs, intending to uproot my rose bushes and smash in my front door and demand my standard of living for themselves and their children. 

Recent research suggests that my paranoia was not, well, so paranoid after all. 

The much-reviewed new book “Plutocrats: The Rise of the New Global Super-Rich and the Fall of Everyone Else,” advances the proposition that successful states are inclusive, giving everyone access to economic opportunity, while failed states are extractive, with the ruling leaders attempting to extract as much wealth as possible from the rest of society.  Using Medieval and Renaissance Venice as a model, the authors trace the decline of that City as the elites first closed off social mobility and then utilized that closure as an argument for closing off economic mobility. 

Someone then might try for a perceived easy analogy: concentration of wealth in the United States, in the hands of the 1%, may lead to the destruction of the American society which is the original source of that wealth.  Recent studies cited by the author indicate that in America today the escape from social class at birth has become more difficult than elsewhere; we find ourselves on the “Great Gatsby Curve” of the super-elites educating their children disproportionately and training them to continue an extractive approach to society. 

The ultimate proof of course was the bailout: Wall Street was rescued by the elite, in control of the instrumentalities of government, while the poor were left behind; 93% of the income gains from the 2009-2010 recovery flowed to the top 1%.  Tax perks and pork barrel for the rich simply reemphasized the point. 

We next consider an opinion piece in the Sunday October 14^th New York Times, entitled “Which Millionaire Are You Voting For?”  It seems that whether you are a Republican or a Democrat, if you are running for office you are most likely very rich.  In a clever shorthand, the columnist notes that if millionaires were a political party, they would make up 3% of American families but “would have a super-majority in the Senate, a majority in the House, a majority on the Supreme Court and a man in the White House.”  The trend continues down the political pecking order, the author noting the lack of blue collar day job holders even at the City Council level.  You could conclude that this political reality is a symptom of the United States de facto cementing the ruling oligarchy in place, another proof that we are creating an extractive society.

The column suggests that American governance would be improved if we were to elect qualified people whose principal occupations were in the blue collar field.  Failing to do so feeds the concentration of wealth; “social safety net programs are stingier, business regulations are flimsier, tax policies are more regressive, and protection for workers are weaker than they would be if our lawmakers came from the same mix of classes as the people they represent.” 

To the argument that qualified public servants cannot be found in the working class, the columnist asks us whether we really believe that some number of qualified working class people cannot be found among the ninety million blue collar workers in the United States, even assuming that, as a cohort, they are less educated, less politically aware and less politically engaged (and let me throw in that they are simply dumber and lazier while we are at it, because that focuses the point even more).  Given the overall numbers, it is quite probable that there are more qualified blue collar Americans to serve as candidates than there are lawyers possessing electable characteristics.  Indeed if only a half percent of blue collar workers qualified as good candidates, you could fill the Congress and every state legislature more than forty times, and have enough blue collar people left over to “run thousands of City Councils.” 

The literature documenting the American oligarchy is robust and growing.  However, aside from the now-fizzled Occupy movement, little political impact has been felt by reason of this recognition.  Those who consider Obama’s politics to fall on the far left might require a reset of their metrics.  My European friends point out that American politics reflect a very narrow band of political and social thought, and that indeed the American political game “is played between the forty yard lines” rather than across the entire possible field of thinking. 

You don’t have to agree that this American fundamental commonality in political approach is bad, or that it is good, to acknowledge that it exists.  In this sense, the ardor with which the current campaign is being fought is somewhat surprising; from the standpoint of economics at least, the election of the next American President is very unlikely to constitute a game changer. 

Are we becoming an extractive society destined to fail, enforcing the closing of economic opportunity through a closed political oligarchy?  Are we doomed to shrink like Venice?  Should we be shopping for a gondola, rather than a Lexus?  Stay tuned.