The Most Dangerous Class

By Joel Kotkin

Tuesday, March 29, 2022

 

Twenty-first-century America may be dominated by oligarchic elites, but arguably the biggest threat to our economic and political system might be located further down the food chain. This most dangerous class comes from the growing number of underemployed, overeducated people. They’re what has been described in Britain as the lumpenintelligentsia: alienated, angry, and potentially agents of our social and political deconstruction.

 

This is far more than an angry mob shouting in keystrokes, but the proto-proletariat of a feudalizing post-industrial society. Overall, notes one recent study, over the past 20 years we have created twice as many bachelor’s degrees as jobs to employ them. Instead of finding riches in the “new economy,” many end up in lower-paying, noncredentialed jobs. They then compete with working-class kids, often products of similarly dysfunctional high schools; an estimated one-third of American working-age males are now outside the labor force, suffering high rates of incarceration, as well as drug, alcohol, and other health issues.

 

Although they are not subject to the same pressures of the working class, the fate of those attending college and even graduating is far from bright. This is the most-anxious generation in recent history, and for good reason. Today more than 40 percent are working in jobs that don’t require their degree, according to a recent report from the Federal Reserve Bank of New York. Another study notes that most may never ascend to the kinds of jobs that graduates have historically enjoyed.

 

This is a global phenomenon. Over a quarter of Chinese graduates are unemployed, and the number is increasing.

 

In India, one in three graduates up to the age of 29 is unemployed, according to a Labour Ministry report released last November, almost three times the country’s overall unemployment rate. A recent U.N. analysis also suggested that this huge bulge of underemployed educated people could undermine the country’s stability in the years ahead.

 

As Greta Thunberg and her legions remind us, young, discontented people have tended to push toward the extremes. In Latin America, underemployed graduates have long been a source of disruption. Today roughly half of all Latin American college students don’t graduate, and many never really see a payback for their time in college.

 

A similar pattern of disruption drove the Arab Spring. There, as well as in the Balkans, unemployed and underemployed college graduates have been a major disruptive force. In Africa, where youth unemployment is also high and the numbers are growing fastest, college graduates who compose barely 7 percent of the total workforce also labor in low-end jobs.

 

Earlier, underemployed intellectuals were critical to the success of the Bolshevik Revolution — a largely powerless, impoverished intelligenti embraced the red cause of overturning all major institutions. Later, many rewarded themselves with the privileges of the old aristocracy, albeit dressed up in egalitarian camouflage.

 

A large portion of Germany’s far larger educated but also often near-destitute population embraced national socialism. As the historian Frederic Spotts has noted, many welcomed the Führer’s efforts to “cleanse” German culture of foreign contamination, while “testimonials of loyalty rained down upon it unrequested.” Some of those testimonials were self-serving, Spotts suggests, since Nazi policies were hostile to leftist intellectuals and artists, as well as gays and Jews. Getting these rivals out of the way could be a good career move. But attachment to Nazism was not simply opportunistic. Universities served as a “stronghold” of the regime, with Nazis winning control of student councils as early as the 1920s. Ultimately highly educated young Germans, once afflicted with unemployment and underemployment, would provide an important early recruiting base for Himmler’s SS.

 

Historically this was less the case in America. Enrollment in colleges and universities in the United States increased threefold between 1910 and 1940, and, with the exception of the Depression years, the U.S. economy was able to produce enough good jobs for them. The expansion continued after the Second World War, as the GI bill helped double the number of degree-holders by 1950. With the growing availability of college loans, the total number of people enrolled in college in the United States grew from 5 million in 1964 to over 7.6 million in 1970, and then to some 20 million today. The percentage of college graduates in the labor force soared from under 11 percent in 1970 to over 30 percent in 2010 — a proportion that has remained about the same since then. With each educational-level achievement, there was the expectation — and reality — of higher earnings, notes historian Robert Gordon.

 

The appeal of college grew as the old blue-collar economy faded, and, at least initially, seemed to be a safe harbor for new workers. But over the past few decades, as the number of college graduates has soared, the supply of good-paying jobs has declined. The costs of the former have soared, too: Since 1971 the price tag for a four-year degree has increased more than four times the rate of inflation.

 

The upper tier of universities continues to thrive, notes David Rothkopf, author of Superclass: The Global Power Elite and the World They Are Making, filling the ranks of the global “superclass.” Their positions have waxed relative to less well-positioned institutions, including state schools and non-elite private colleges. For the most part they remain bastions of the class order: Harvard, Princeton, Stanford, and Yale collectively enroll more students from households in the top 1 percent of the income distribution than from households in the bottom 60 percent. Robert Reich, a lion of the Left and a former Harvard professor, characterizes the modern elite universities as being designed mainly “to educate children of the wealthy and upper-middle class.”

 

Like the society it is serving, academia itself reflects, in some ways, a reversion to an older, almost premodern society. For most college teachers, the road to tenure is problematic, as most remain adjuncts on minimal salaries and obtain little in the way of security. They live, as was noted on the Working-Class Studies blog, “precarious workers, more like restaurant and hospitality workers, gig performers, contract healthcare workers, and delivery drivers than the tenured professor.” Noah Rothman of Commentary magazine has compared today’s universities to a modern form of manorialism in which top administrators, deans, and tenured faculty enjoy comfort, leisure, and security, but teaching adjuncts decidedly do not. Today roughly 75 percent of college teachers are not on tenure track, and half of these are part-timers. One in four of this group lives on some form of public assistance. Some of them actually see their commitment to the academy as akin to a monk’s “vow of poverty.”

 

Their students, particularly outside the elite colleges, don’t do all that much better. A college degree from elite schools such as Harvard or Yale still has economic value, but a large proportion of those attending college would be better off not doing so. College enrollments continue to drop, down over 6 percent since 2019. For many, the option of trade school offers third option, one that now appeals to roughly three-fifths of the American public and is increasingly seen by companies as a more useful form of education than just collecting degrees.

 

Indeed, a survey taken in 2020 found that only a third of undergraduates see their education as advancing their career goals and barely one in five think the BA is worth the cost. The combination of poorer parents, decreasing rewards to education, and distaste among many Americans for academia’s overwhelmingly progressive agenda may further depress college attendance in the future. The upfront investment is high (tuition fees for four-year public colleges have increased by an average of 213 percent in real terms — for private colleges the figure was 129 percent — between 1988 and 2017) and returns are not guaranteed. The future for many colleges, particularly in the liberal arts, may be grim indeed.

 

More troubling still, universities can get away with obscurantism and enforced ideological conformism because of their enormous power over labor markets. They are no longer primarily about learning, as Jane Jacobs noted as far back as 2004, but about providing the credential needed for a high-paying job. What they increasingly don’t teach are skills useful in the workplace. One recent study of American college students found that more than one-third of students “did not demonstrate any significant improvement in learning” in four years of college. Employers report that recent graduates are short on critical-thinking skills.

 

Getting a graduate degree is increasingly irrelevant, too. More than 140 colleges “paused” admissions to doctoral programs during the pandemic. The best guess is that quite a few of these pauses will be permanent. But the diminished prospects extend well beyond academia. Overall, people now in their thirties are considerably less likely to own a home than were their counterparts in earlier generations, due to a shortage of starter homes, blocking the key method of wealth accumulation. By some estimates, increases in home values over the last decade accounted for 86 percent of middle-class wealth accumulation.

 

Indeed, according to projections from the Deloitte Center for Financial Services, Millennials will control barely 15 percent of the nation’s wealth in 2030 — half the proportion of Generation X and barely one-third of the share that will be enjoyed by Boomers, who by then will be entering their 80s. In the aftermath of two huge events — the 2008 financial crisis and the pandemic — more educated people have been forced to embrace gig work, which has been a boon for some but has left many others, here and abroad, consigned to a regime of insecurity and low wages.

 

The junction of indoctrination and declining opportunities leaves our society, and the future of the republic, in great peril. In 2018 half of all recent college grads made under $30,000 annually and in half of the schools, they earn less than a high-school-educated person even six years later. As they age, many of these workers may never really enter the high-end job market. Your local Uber driver or Starbucks barista is not likely to become tomorrow’s entrepreneurial success, nor will the part-time teacher of gender studies work at anything but low wages.

 

This is a generation in which entrance to the middle class is increasingly blocked. Over 90 percent of people born in the 1940s and 80 percent in the 1950s did overwhelmingly better than their parents. Among those born in the 1980s, almost half do worse. The decline, note Richard Reeves and Katherine Guyot in a study for the Brookings Institution, is most evident among the upper-middle class, the very group that has long prioritized education.

 

There could be different responses to this decline. Some on the left see a reprise of labor militancy, which includes sporadic, occasionally successful, organizing efforts among tech workers, college adjuncts, Amazon warehouse workers, and Starbucks baristas. This will not be a reprise of George Meany’s AFL-CIO, and may only be limited as — despite the media coverage — the rate of private-sector unionization is at its lowest ebb in recent history.

 

Instead, our young proto-proletarians will seek their fortune from the public coffers. Many already embrace socialism. In the 2016 primaries, the openly socialist Bernie Sanders easily outpolled Hillary Clinton and Donald Trump combined among voters under 30. In the early 2020 primaries, even as the older cohorts rejected him decisively, Sanders trounced his competitors among the young once again. A poll conducted by the Communism Memorial Foundation in 2016 found that 44 percent of American Millennials favored socialism while 14 percent preferred fascism or communism. By 2024, Millennials and Zoomers will both equal the voting share of the long-dominant Boomers.

 

One issue that may appeal is to substitute work with a universal basic income, which would remove the need to perform in a market economy. Most Americans over 50 strongly reject this idea, but those under 30, notes Pew, embrace it by two to one. Some have even embraced an “anti-work” lifestyle, which basically means the rest of us will be supporting them until we keel over.

 

The youthful progressive Left — as opposed to more-traditional liberals — reject much of this country, seeking instead to replace it with a nation “transformed” into some ill-conceived mashup of Venezuela, Cuba, and (their fantasy) Sweden, constituting what one conservative writer has described as “a zombie army of anti-capitalists.”

 

Yet if it is easy to disagree with and reject the authoritarian tendency among proto-proletarians, it is incumbent on those who are either conservatives or traditional liberals to come up with paths for success for those who do not attend four-year schools as well as those who do. Better jobs, not more welfare, is the key to greater equality and less alienation. A nation of struggling renters, with no hope of ascending into the middle class, are fodder for authoritarians; they do not make the ideal citizenry of an optimistic, vibrant republic.