America’s Drift toward Feudalism

In the world envisioned by the oligarchs, the poor and much of the middle class are destined to become more dependent on the state. This dependency could be accelerated as their labor is devalued both by policy hostile to the industrial economy, and by the greater implementation of automation and artificial intelligence. Imbued with a sense of natural su­periority—whether based on religion or some sense of elevated cognitive abilities, the Oligarchs and their professional class of enablers now seek to shape our cultural, political, and social environments in ways that often violate the standards of liberal democracy, open exchange, and pluralism.

by Joel Kotkin for AMERICAN AFFAIRS JOURNAL

America’s emergence in the eighteenth and nineteenth centuries represented a dramatic break from the past. The United States came on the scene with only vestiges of the old European feudal order—mostly in the plantation economy of the Deep South. There was no hereditary nobility, no national church, and, thanks to George Washington’s modesty, no royal authority. At least among whites, there was also far less poverty in America, compared to Europe’s in­tense, intractable, multigenerational poverty. In contrast, as Jeffer­son noted in 1814, America had fewer “paupers,” and the bulk of the pop­ulation was “fed abundantly, clothed above mere decency, to la­bor moderately and raise their families.”

Yet in recent decades this country, along with many other liberal democracies, has begun to show signs of growing feudalization. This trend has been most pronounced in the economy, where income growth has skewed dramatically towards the ultrarich, creating a ruling financial and now tech oligarchy. This is a global phenomenon: starting in the 1970s, upward mobility for middle and working classes across all advanced economies began to stall, while the prospects for the upper classes rose dramatically.

The fading prospects for the new generation are all too obvious. Once upon a time, when the boomers entered adulthood, they en­tered an ascendant middle class. According to a recent study by the St. Louis Fed, their successors, the millennials, are in danger of be­coming a “lost generation” in terms of wealth accumulation.

This generational shift will shape our future economic, political, and social order. About 90 percent of those born in 1940 grew up to experience higher incomes than their parents, according to researchers at the Equality of Opportunity Project. This proportion was only 50 percent among those born in the 1980s, and the chances of middle-class earners moving up to the top rungs of the earnings ladder has declined by approximately 20 percent since the early 1980s. Corporate CEOs used to boast of starting out in the mailroom. There will not be many of those stories in the future.

The Return to Oligarchy

In feudal society, power was exercised primarily by two classes—what the French referred to as the First Estate, the clergy, and the Second Estate, comprised of the warrior-aristocratic elite. Everyone else, even successful merchants, resided in the Third Estate, and most were peasants living at subsistence levels. This was a society, noted historian Pierre Riché, composed of “those who prayed, those who fought, and those who labored.”1

Contemporary society may have little place for orthodox religion, and our military, however impressive, hardly constitutes an effective ruling class. But we are beginning to see the elevation of two very powerful classes—one dominant economically, the other culturally. Meanwhile, the power of today’s Third Estate inexorably weakens.

The ultrarich represent an emergent global aristocracy—or rather, a new oligarchy. Fewer than one hundred billionaires now own as much as 50 percent of the world’s assets—the same amount that around four hundred billionaires owned a little more than five years ago. In the United States, the richest four hundred U.S. citizens now have more wealth than 185 million of their fellow Americans com­bined. The shift has been dramatic: the top 1 percent in America captured just 4.9 percent of total U.S. income growth from 1945 to 1973, but in the following two decades the country’s richest classes gobbled up the majority of U.S. income growth.

Patterns of property ownership reflect the very same trends that anchored both the medieval aristocratic and ecclesiastical classes. The proportion of land owned by the nation’s hundred largest private landowners grew by nearly 50 percent between 2007 and 2017. In 2007, according to the Land Report, this group owned a combined twenty-seven million acres of land, equivalent to the area of Maine and New Hampshire combined. A decade later, the hundred largest landowners had holdings of over forty million acres. Their holdings are now larger than the entirety of New England. Even in much of the vast American West, where much of the land remains in public hands, billionaires have created expansive estates that many fear will make the rest of the local population land-poor.

In the past, the oligarchy tended to be associated with either Wall Street or industrial corporate executives. But today the predominant and most influential group consists of those atop a handful of mega-technology firms. Six firms—Amazon, Apple, Facebook, Google, Microsoft, and Netflix—have achieved a combined net worth equal to one-quarter of the nasdaq, more than the next 282 firms combined and equal to the GDP of France. Seven of the world’s ten most valuable companies come from this sector. Tech giants have produced eight of the twenty wealthiest people on the planet. Among the na­tion’s billionaires, all those under forty live in the state of California, with twelve in San Francisco alone. In 2017, the tech industry pro­duced eleven new billionaires, mostly in California. Only China, home to nine of the world’s top twenty tech firms, presents any kind of challenge to their domination.

Initially many Americans, even on the left, saw the rise of the tech oligarchy as both transformative and positive. Observing the rise of the technology industry, the futurist Alvin Toffler prophesied “the dawn of a new civilization,”2 with vast opportunities for societal and human growth. But today we confront a reality more reminiscent of the feudal past—with ever greater concentrations of wealth, along with less social mobility and material progress.

Rather than Toffler’s tech paradise, we increasingly confront what the Japanese futurist Taichi Sakaiya, writing three decades ago, saw as the dawn of “a high-tech middle ages.”3 Rather than epitomizing American ingenuity and competition, the tech oligarchy increasingly resembles the feudal lords of the Middle Ages. With the alacrity of the barbarian warriors who took control of territory after the fall of the Roman Empire, they have seized the strategic digital territory, and they ruthlessly defend their stake.

Such concentrations of wealth naturally seek to concentrate power. In the Middle Ages, this involved the control of land and the instruments of violence. In our time, the ascendant tech oligarchy has exploited the “natural monopolies” of web-based business. Their “super-platforms” depress competition, squeeze suppliers, and reduce opportunities for potential rivals, much as the monopolists of the late nineteenth century did. Firms like Google, Facebook, and Microsoft control 80 to 90 percent of their key markets and have served to further widen class divides not only in the United States but around the world.

Once exemplars of entrepreneurial risk-taking, today’s tech elites are now entrenched monopolists. Increasingly, these firms reflect the worst of American capitalism—squashing competitors, using inden­tured servants from abroad for upwards of 40 percent of their Silicon Valley workforce, fixing wages, and avoiding taxes—while creating ever more social anomie and alienation.

The tech oligarchs are forging a post-democratic future, where opportunity is restricted only to themselves and their chosen few. As technology investor Peter Thiel has suggested, democracy—based on the fundamental principles of individual responsibility and agency—does not fit comfortably with a technocratic mindset that believes superior software can address and modulate every problem.

This emerging world is far removed from the democratic capitalism that dominated the era after World War II. Rather than encouraging and accommodating families, today’s oligarchs promote a largely childless college campus environment, where they even pay female workers to freeze their eggs. Traditionally companies liked employees with families. Not so much in the brave new tech world, which demands long hours and little time off for such things as raising children.

As for the rest of the population, the prospects are even bleaker. In the tech hub of San Francisco, the middle-class family is almost extinct. The city has lost thirty-one thousand home-owning families over the past decade. It leads the state in economic inequality. The evidence of massive inequality, pervasive homelessness, and social dysfunction fills the streets.

Silicon Valley, located in the suburbs south of the city, has also become profoundly less egalitarian. It is increasingly divided between an entrenched ultra-wealthy class and a dependent poor class, work­ing largely in the service industries. By 2015, some seventy-six thou­sand millionaires and billionaires called Santa Clara and San Mateo coun­ties home, while many in the area struggle to feed their families and pay their bills each month. Nearly 30 percent of Silicon Valley’s residents rely on public or private assistance.

Wired magazine’s Antonio García Martínez describes the contemporary Valley as “feudalism with better marketing.” In Martínez’s view, a plutocratic elite of venture capitalists and company founders sit above the still-affluent cadre of skilled professionals—well paid, but living only ordinary middle-class lives, given taxes and high pri­ces. Below them lies a vast population of gig workers, whom Martínez compares with sharecroppers in the South. And at the very bottom lies an untouchable class of homeless, those addicted to drugs, and criminals.

Martínez describes a society that, as in the Middle Ages, is “highly stratified, with little social mobility.” High prices make it all but impossible for anyone except the very affluent to own their homes. Workers in the gig economy, much less the “untouchables,” have little chance to improve their lot but struggle to barely pay their rent, or are forced to sleep in their cars, on friend’s couches, or commute long distances from the outlying periphery.

Feudalism with Better Marketing

This new feudal order rests on a new clerisy, which has now taken the cultural and intellectual role exercised by the old First Estate. Al­though largely secular, these worthies take on the role of ecclesiastical authorities from medieval times, seeing themselves as anointed to direct human society—a modern version of the feudal “oligarchy of priests and monks whose task it was to propitiate heaven.”4

Far larger and broader than the oligarchy, the clerisy spans an ever‑growing section of the workforce that largely works outside material capitalist enterprise—as teachers, consultants, lawyers, gov­ernment workers, and even doctors, more of whom now work as employees or contractors than owners. These professions have only grown, while those of the traditional middle class—small business owners, workers in basic industries and construction—have seen their share of the job market shrink.

Estimates of the size of the clerisy vary. Michael Lind estimates what he calls the “overclass” at some 15 percent of the American workforce, far larger than the membership of the old First Estate, which was closer to 1 percent of the French population. Charles Murray, on the other hand, offers a narrower estimate including only those at the top echelon in law, government, and universities—roughly 2.4 million people out of a country of over 320 million.5

At its apex, the clerisy today is dominated by what Daniel Bell would define as the “knowledge class.”6 Made up largely of the well-educated offspring of the affluent, this class has become increasingly hereditary in part because well-educated people marry each other. Between 1960 and 2005, the share of men with university degrees who married women with university degrees nearly doubled, from 25 to 48 percent. “After one generation,” as Bell noted, “a meritocracy simply becomes an enclaved class.”7

The new clerisy is crucially important to the new oligarchs, who need allies in the government, media, and academia to maintain their supremacy. In many cases the tech elite now control the clerisy’s own industries: consider the media, with Jeff Bezos’s takeover of the Washington Post, and the entertainment industry, with the rise of Netflix, Apple, and Amazon in Hollywood.

The political rise of this cultural overclass has been building for well over fifty years. As early as the 1960s, presidential historian Theodore White spoke of the “the new priesthood . . . of action intel­lectuals” that shaped the John F. Kennedy administration. This ming­ling of intelligentsia and power reached a pinnacle during the presi­dency of Barack Obama, whose administration was staffed al­most exclusively with products of the nation’s elite universities. More than sixty administration officials, roughly a fourth of Obama’s over­all appointments, had attended just one school—Harvard. Remark­ably, more top administration officials had degrees from Oxford Univer­sity than from any American public university.

Like the old First Estate, the clerisy—what the French socialist writer Christophe Guilluy calls “the privileged stratum”—operate from an assumption of “moral superiority” that justifies their right to rule.8 They represent the apotheosis of H. G. Wells’s notion of an “emergent class of capable men” who could take upon itself the task of “controlling and restricting . . . the non-functional masses.” This new elite, he predicted, would replace democracy with “a higher organism,” what he called “the New Republic.”9

Whereas the old First Estate justified its control based on spiritual dogma, the modern clerisy bases much of its power on its reading of “science.” Its members claim that, rather than mere factionalism, they represent an “objective” perspective above personal considerations. “When scientists say they want to live up to their social responsibilities, what they usually say is that they want more power than they have,” once observed Irving Kristol. “It means they want to run things, to take charge. It’s always nicer to run things than to be run by them.”

A shared belief in meritocratic superiority binds the oligarchs and the clerisy. This has led, as in medieval times, to a remarkable sharing and dissemination of orthodoxy. Even professions such as journalism, once at least somewhat diverse philosophically, have become, with few exceptions, boosters of the “progressive” party line. By 2018, barely 7 percent of U.S. reporters stated they were Republicans; some 97 percent of all journalist political donations go to Democrats.

Similar patterns can be seen in other media as well. Once divided between conservatives and liberals, Hollywood and its imitators else­where now tilt heavily to the Left. Liberal columnist Jonathan Chait, reviewing the offerings of major studios and networks, described what he called “a pervasive, if not total, liberalism.” In 2018, over 99 percent of all major entertainment executives’ donations went to Democrats.

Universities and the New Clerisy

But the ultimate engine of the clerisy’s power, and the prime incubator of its orthodoxy, lies in the universities. This sector has expanded its influence and scope enormously in the last half century. The total number of people enrolled in college in the United States grew from five million in 1964 to nearly eight million in 1970 and to some twenty million today.

Yet even as the universities have expanded, it’s the elite tier that serves as the ultimate gatekeepers for the upper classes. In his book Superclass: The Global Power Elite and the World They Are Making, David Rothkopf compiled a list of more than six thousand members of the “superclass” around the world—including leaders of corporations, banks and investment firms, governments, the military, the media, and religious groups. After drawing a “globally and sectorally representative sample” of three hundred members from the list, Roth­kopf and his colleagues found that close to three in ten attended one of twenty elite universities—with Stanford, Harvard, and the Uni­versity of Chicago most highly represented.10

As elite universities have become more expensive and more critical to success, they have become, if anything, more socially exclusive, widening the gap between themselves and smaller, less well-posi­tioned institutions.11A National Journal survey of 250 top American public sector decision-makers—a critical part of the upper clerisy—found that 40 percent of them were Ivy League graduates. Only a quarter had earned graduate degrees from a public university. The days of rising up from a minor college to a position of influence and high status increasingly belong to the past.

Equally troubling, the clerisy, again like its medieval counterparts, has adopted a role as an enforcer not of free thought but of “pro­gressive” orthodoxy. These trends are particularly acute in fields that most impact public policy and opinion. Well under 10 percent of faculty at leading law schools, such as Harvard, Yale, Stanford, Columbia, and Berkeley, describe themselves as conservative. Leading journalism schools, including Columbia, have moved away from teaching the fundamentals of reporting and have adopted a “social justice” agenda as their signature approach.

Much like the early Church after the fall of Rome, which sought to suppress the memory of pagan civilization, the clerisy now has turned against the inheritance of modern liberal capitalism. In the schools, they have worked to remove the lodestones of that culture—Homer, Cicero, Shakespeare, Milton, and the founding fathers—from the campus curriculum. Instead they favor more politically correct books that tend to focus on the undoubted failings of our civilization, but rarely support the idea of America as a fundamentally liberal society which has provided unmatched opportunity for millions.

In modern America, the clerisy represents an ascendant class that shapes many of the “progressive” values embraced by the oligarchs and helps legitimate their rule. Imbued with a sense of natural su­periority—whether based on religion or some sense of elevated cognitive abilities, they now seek to shape our cultural, political, and social environments in ways that often violate the standards of liberal democracy, open exchange, and pluralism. Before we cede such power to the clerisy, we may want to consider the old Latin phrase quis custodiet ipsos custodes—who watches the watchers? In the rise of the clerisy, we see a powerful force for hierarchy, social stagnation, and thought control that could rival the role played by its predecessors in medieval times.

The Decline of the Third Estate in America

As the oligarchy and clerisy have waxed, the prospects for the Ameri­can third estate have either stagnated or gotten worse. In the United States, a country built on aspiration, the fading prospects for the new generation are now painfully obvious. Three-quarters of American adults today will not grow up to be better off than their parents. According to Pew, a majority of parents think their children will be financially worse off than themselves.

Unlike their parents, most of whom joined the middle-class yeo­manry, many young people face a future as propertyless serfs. By 2030, according to a Deloitte study of U.S. trends, millennials will account for barely 16 percent of the nation’s wealth. GenXers will hold 31 percent, but even in 2030, when they will be entering their eighties and nineties, boomers will still control a remarkable 45 per­cent of the nation’s wealth.

This erosion of the “American dream” centers largely on property. Since the end of feudalism, the rise of market-oriented democracy has accompanied the rapid dispersion of property ownership. This factor, critical in the earliest development of self-government in ancient Athens and Rome, was critical to the American founders’ conception of a republic. During the middle of the twentieth century, rates of homeownership in the United States expanded from 44 percent in 1940 to 63 percent thirty years later. Yet in the new generation, this prospect is fading. In the United States, homeownership among the post-college cohort (ages 25–34) has dropped from 45.4 percent in 2000 to 37 percent in 2016, a drop of 18 percent, according to Census Bureau data.

Some pundits suggest the decline of homeownership stems from changing preferences among younger people. Planners, social pundits, and urban intellectuals within the clerisy repeatedly make this asser­tion—one echoed by investors who seek to create a “rentership” society where people remain renters for life, enjoying their video games or houseplants. Yet virtually all surveys show that the vast majority of younger people would like to own a single-family home, and most want to raise children. The reason for not doing so lies with high housing costs.

In the emerging neo-feudal world, property ownership is increasingly restricted to older generations, who benefit from expanding home values and rental income, as well as wealthy institutional investors. In this new order, inheritance, notes French economist Thomas Piketty, seems destined to “make a comeback.”12 In the next generation, inheritance may play a role unseen since the nineteenth century. In America, a nation with a mythology disdainful of inher­ited wealth, millennials are counting on inheritance for their retirement at a rate three times that of the boomers. Among the youngest cohort, those 18 to 22, over 60 percent see inheritance as their primary source of wealth as they age.

The Politics of Inequality

These changes in the patterns of ownership and class will likely reshape liberal democracy, creating “new forms of government,” pre­dicts Stratfor’s Eric Schnurer, “[with] economics and social organization as different from today’s as our world is from the Middle Ages.” The shrinking of the yeoman class of small businesspeople and prop­erty owners certainly undermines the ballast of democratic community life, and could well accelerate the already ongoing radicalization of American politics.

This radicalization is clearest among millennials—those faced with limited prospects for upward mobility. Some 40 percent of millennials, notes Pew, favor limiting speech deemed offensive—well above the 27 percent of GenXers, 24 percent of boomers, and 12 percent of the oldest, many of whom recall the censorship imposed by fascist and communist regimes of the past. Millennials are also more likely to be dismissive about basic constitutional civil rights, and are even more accepting of a military coup than previous generations.

This new radical bent extends to both Right and Left. In November 2016, more white American millennials voted for Donald Trump than Hillary Clinton. But the new radicalism is, for now, most pro­nounced on the left. During the 2016 primaries, socialist Bernie Sanders outpolled Hillary Clinton and Donald Trump combined. A 2016 poll by the Victims of Communism Memorial Foundation found that 44 percent of American millennials favored socialism while another 14 percent chose fascism or communism. By 2024, these mil­lennials will be by far the country’s biggest voting bloc.

Drawing little hope from the private sector, many millennials en­dorse policies that favor handing control of American economic life to Washington. Some of this tendency rests on environmental con­cerns, but economic inequality drives much of the thinking. As one of the architects of the Green New Deal recently said, “Do you guys think of [the Green New Deal] as a climate thing? Because we really think of it as a how-do-you-change-the-entire-economy thing.”

The Coming Battle

Ultimately the shift of millennials to the Left could lead to a conflict between the oligarchs and the clerisy over the appropriation of wealth. The way things look now, the battle will be over who pays for an ever-expanding welfare state—not how to expand the middle class. This is likely to shift our politics increasingly in an authoritarian direction. As the great historian Barrington Moore noted, “No bourgeois, no democracy.” In a country where the middle ranks are shrinking, the elites more powerful, and ideological polarization is on the rise, the prospects for democracy, even in its greatest homeland, could be grim indeed.

In the world envisioned by the oligarchs and the clerisy, the poor and much of the middle class are destined to become more dependent on the state. This dependency could be accelerated as their labor is devalued both by policy hostile to the industrial economy, and by the greater implementation of automation and artificial intelligence.

Opposing these forces will be very difficult, particularly given the orientation of our media, academia, and the nonprofit world, as well as the massive wealth accumulated by the oligarchs. A system that grants favors and entertainment to its citizens but denies them prop­erty expects little in return. This kind of state, Tocqueville suggested, can be used to keep its members in “perpetual childhood”; it “would degrade men rather than tormenting them.”13

Reversing our path away from a new feudalism will require, among other things, a rediscovery of belief in our basic values and what it means to be an American. Nearly 40 percent of young Ameri­cans, for example, think the country lacks “a history to be proud of.” Fewer young people than previous generations place an emphasis on family, religion, or patriotism. Rather than look at what binds a dem­ocratic society together, the focus on both right and left has been on narrow identities incapable of sustaining a democratic and pluralistic society. The new generation has become cut off from the traditions and values of our past. If one does not even know of the legacies underpinning our democracy, one is not likely to notice when they are lost.14 Recovering a sense of pride and identification with Ameri­ca’s achievements is an essential component of any attempt to recover the drive, ambition, and self-confidence that propelled the United States to the space age. If we want to rescue the future from a new and pernicious form of feudalism, we will have to recover this ground.

To reverse neo-feudalism, the Third Estate—the class most threat­ened by the ascendency of the oligarchs and the clerisy—needs to re­invigorate its political will, just as it did during the Revolution and in the various struggles that followed. “Happy the nation whose people has not forgotten to how to rebel,” noted the British historian R. H. Tawney.15 Whether we can understand and defy the new feudalism will determine the kind of world our children will inherit.

This article originally appeared in American Affairs Volume III, Number 4 (Winter 2019): 96–107.

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