Tag Archive for: neo-feudalism

Welcome to the End of Democracy

We bemoan autocracies in Latin America, the Middle East, Africa, Russia and China but largely ignore the more subtle authoritarian trend in the West. Don’t expect a crudely effective dictatorship out of Orwell’s Nineteen Eighty-Four: we may remain, as we are now, nominally democratic, but be ruled by a technocratic class empowered by greater powers of surveillance than those enjoyed by even the nosiest of dictatorships.

The new autocracy rises from a relentless economic concentration which has engendered a new and fabulously wealthy elite. Five years ago, around four hundred billionaires owned as much as half of the world’s assets. Today, only one hundred billionaires own that share, and Oxfam reduces that number to a mere twenty-six. In avowedly socialist China, the top one percent of the population holds about one-third of the country’s wealth, up from 20 percent two decades ago. Since 1978, China’s Gini coefficient, which measures inequality of wealth distribution, has tripled.

An OECD report issued before the Covid pandemic finds that almost everywhere, the non-rich share of national wealth has declined. These trends can be seen even in social democracies like Sweden and Germany. In the United States, as the conservative economist John Michaelson put it succinctly in 2018, the economic legacy of the last decade is “excessive corporate consolidation, a massive transfer of wealth to the top 1 percent from the middle class.”

This process has developed both in the tangible and digital economies. In Great Britain, where land prices have risen dramatically over the past decade, less than one percent of the population owns half of all the land. On the European continent overall, farmland has fallen increasingly into the hands of a small cadre of corporate owners and the mega-wealthy. In America, the largest farmland holder is Bill Gates, with over 200,000 acres, while Ted Turner and John Malone preside over lordly estates of over two million acres each — larger than several American states.

As property has concentrated, small-holders have come under increased pressure. Australia historically has enjoyed high rates of homeownership, but the rate among twenty-five to thirty-four year-olds dropped from more than 60 percent in 1981 to only 45 percent in 2016. The proportion of owner-occupied housing in once-egalitarian Australia has dropped by 10 percent in the last twenty-five years. Morgan Stanley predicts that the US will soon become primarily a “rentership society” where Wall Street firms seek to turn homes, furniture and other necessities into rental products.

The digital economy is similarly dominated by a small group of giant firms. These overlords together exercise control of up to 90 percent of critical markets such as basic computer operating systems, social media, online search advertising and book sales. No longer satisfied with controlling the pipelines, the tech oligarchy increasing buys up old news outlets and “curates” the news to its tastes. It increasingly dominates mainstream entertainment too: the pending sale of MGM to Amazon is just the most recent example of its conquest and consolidation of the means of communication.

Like the barbarian princes who shaped the Middle Ages, the new oligarchs have been able to seize their fiefdoms with little resistance from weak central governments. The pandemic accelerated this process; its lockdowns and restraints on mobility proved a bonanza for tech companies like Google, whose profits doubled during the period. In this highly regulated environment, the tech-rich have simply gotten richer: seven of the ten richest Americans come from the tech sector. Apple, by some calculations, is now worth more than the entire oil and gas industry. The already obscenely rich have become richer still. Jeff Bezos alone saw his net worth jump by an estimated $34.6 billion in the first two months of the pandemic, while his company has enjoyed continued revenue and profit growth.

As executive compensation reached the stratosphere in Big Tech and finance, small businesses face what the Harvard Business Review calls “an existential threat.” Experts now warn that one third of small businesses, which comprise the majority of US companies and employ nearly half of all workers, could ultimately shut down for good. Hundreds of thousands have already disappeared, including nearly half of all black-owned businesses. Particularly damaged have been the small merchants along Main Street and those working for them, such as restaurant and hospitality workers.

Read the rest of this piece at The Spectator World.


Joel Kotkin is the author of The Coming of Neo-Feudalism: A Warning to the Global Middle Class. He is the Roger Hobbs Presidential Fellow in Urban Futures at Chapman University and Executive Director for Urban Reform Institute. Learn more at joelkotkin.com and follow him on Twitter @joelkotkin.

Homepage photo: Chris Devers, via Flickr under CC 2.0 License.

Work or Welfare?

Throughout history, work has been the common lot of humanity—at least, outside of the idle rich and those who could not find any. It was celebrated by the Calvinist capitalists described in Weber’s The Protestant Ethic and the Spirit of Capitalism as a means for people to achieve their “own salvation.” Labor for its own sake was embraced by the Marxist canon as well—work, wrote Friedrich Engels, “is the prime basic condition for all human existence, and this to such an extent that, in a sense, we have to say that labor created man himself.”

If a man doesn’t have a job or an income, he has neither life nor liberty nor the possibility for the pursuit of happiness. He merely exists.
~Martin Luther King, Jr. (1968)

Yet today’s baffling shortage of workers in high-income countries may presage something different: a post-work society, in which only a select few labor. For most, economic maintenance would come from some form of universal basic income (UBI). This notion has been tried as part of the COVID-19 relief program and in President Biden’s proposed Build Back Better initiative, which allows benefits for those who could join the workforce but don’t care to.

This idea is arising at a propitious time. A strong majority of people in 28 countries around the world, according to a recent Edelman survey, believe that capitalism does more harm than good. More than four-in-five worry about job loss, particularly from automation. Rising inequality and general fear of downward mobility have boosted support for expanded government and greater re-distribution of wealth.

Surplus classes

As early as 1995, author Jeremy Rifkin suggested that automation would eliminate work for most and create the basis for a society where “large numbers of people could be liberated from long hours in the formal marketplace.” This would allow them to focus on “leisure activities,” a kind of technological utopia for the masses.

It’s a compelling vision in some ways, but right now it looks dystopic. The ranks of what Marx called the “reserve army of the unemployed” are simply disengaging. A decade ago, Gallup’s Jim Clifton wrote about The Coming Jobs War, in which he predicted a global struggle for diminishing employment. Now there is plenty of work but people are not interested. In the US, labor participation rates have fallen from 80 percent in 1950 to 61 percent now, down from 64.4 percent in 2010. Nearly one-third of American working-age males are not in the labor force, suffering high rates of incarceration, or drug, alcohol, and other health issues.

And, to be sure, opportunities may be further reduced by technology, which could accelerate the loss of many kinds of jobs that once provided a means of upward mobility: postal workers, switchboard operators, machinists, computer operators, bank tellers, travel agents. For the 90 million Americans who work in such jobs—and their counterparts elsewhere—the future could be bleak. By 2030, Oxford Economics predicts that 20 million factory jobs worldwide will fall to automation—1.5 million in the US, 2.5 million in the EU, and 12.5 million in China.

The pandemic clearly accelerated this process, notably in the service sector. With the shift to online and takeout food, chains like McDonald’s are perfecting electronic delivery systems that reduce the need for human labor. Large capital investments are necessary for such adaptations, which—as France’s Thomas Piketty has noted—favors larger corporations as opposed to smaller family businesses.

Globalism, automation, and its effects

A plausible future scenario is a society in which a small, hyper-productive technical and managerial elite delivers food, housing, and pleasure to the plebes, like those in the later centuries of the Roman Empire. Their only role in society would be to take and not threaten the imperial state—a system that only worked due to the presence of slaves and huge territories to pillage.

Read the rest of this piece at Quillete.


Joel Kotkin is the author of The Coming of Neo-Feudalism: A Warning to the Global Middle Class. He is the Roger Hobbs Presidential Fellow in Urban Futures at Chapman University and Executive Director for Urban Reform Institute. Learn more at joelkotkin.com and follow him on Twitter @joelkotkin.

Homepage photo: Henry & Co. via Unsplash.

An Unholy Alliance Between Big Tech and Woke is Destroying the Middle Class

By: Steven Edginton

On: The Telegraph

“An unholy alliance between big tech and woke is destroying the middle class”.

With wealth inequality soaring and the power of the elites growing, is society returning to the feudal era? The demographer and geographer Joel Kotkin joins Steven Edginton to discuss his theory of “neo-feudalism”.

Listen to the interview on Spotify

Watch this interview:

Serfing the Planet

Like its global predecessors, the COP26 Glasgow conference will usher in a new wave of apocalyptic warnings about climate change. It will also likely prove no more successful, in terms of actually addressing the issue, than its predecessors, particularly as China, India and other developing countries ramp up their emissions.

Nevertheless, none of this will force the climate activists to reconsider how the current strategies against global warming could break the backs of the already beleaguered working and middle class. (For British readers, I use the phrase ‘middle class’ here in the American – less bourgeois – sense.) The climate chorus of celebrities, oligarchs and royals may feel virtuous, but for most people the future could prove to be propertyless proletarianisation. Many of those in Glasgow at the moment pray at the altar of ‘de-growth’. They want to limit the consumption of the working and middle classes, undermine their jobs, raise their energy bills, and inhibit their ability to buy property or travel.

These policies are fine with ‘woke’ corporatists like BlackRock, who see enormous profits in the regulated shift in energy, even as they seek to expand their business with the world’s dominant polluter, China. What’s missing is any focus on how to cut emissions without causing high inflation, raising energy prices and destroying the middle class. So far, more palatable options, like increasing remote work, geothermal energy, natural gas, nuclear power and varied new technologies, have not managed to get on to the agenda.

With climate, as with many other issues, the upper classes are inflicting their own preferences on working- and middle-class people. As nonprofits, oligarchs and bureaucrats plot out the future, small business owners and the middle class, as one entrepreneur put it, are ‘not at the table – or even in the room’. This is the very class – what I refer to as the yeomanry – that has driven much of the West’s economic progress and nurtured self-government. Democracy was born when both Athens and later Rome included small property owners in governance. Democracy died when these small owners lost power to what Aristotle labelled the ‘oligarchia’.

After the autocratic Middle Ages, both human progress and self-rule came back as the middle classes began to rise – first in Italy but then more profoundly, and more pervasively, in the Netherlands and the British Isles, before spreading to North America and Oceania, where there was no true hereditary aristocracy. Students of classical experience, such as Thomas Jefferson, James Madison and John Adams, all considered the over-concentration of property in a few hands as a basic threat to republican institutions, an insight shared by such intellects as Edmund Burke, Alexis de Tocqueville and Adam Smith.

After the brutalities of the early Industrial Revolution, and two world wars, the middle class thrived not just in America, but also in Britain, Australia, Canada and increasingly in East Asia. But by the 1970s we began what has become an inexorable march towards an ever more feudalistic structure. The Organisation for Economic Cooperation and Development has noted that, across the 36 wealthier countries, the uber-wealthy have taken an ever greater share of national GDP in recent decades, while the middle class ‘looks increasingly like a boat in rocky waters’.

These patterns are clearly evident in the United States, where wealth gains have been especially concentrated among the top 0.1 per cent. The share of national wealth held by those below the top 10 per cent has fallen since the 1980s by 12 percentage points, the same proportion that the top 0.1 per cent have gained. Today, roughly half of all Americans earn less than $35,000 annually, living essentially pay cheque to pay cheque.

Even with their robust social-welfare provisions, over two thirds of European Union countries, including Sweden, have experienced declining social mobility. Germany is significantly less equal than its EU peers, with richer households controlling a bigger share of assets than in most other Western European states. The bottom 40 per cent of German adults hold almost no assets at all; barely 45 per cent of Germans own homes. Even in theoretically socialist China the top one per cent of the population hold about one third of the country’s wealth. Meanwhile, the prospects for the Chinese middle class are fading, particularly in light of the recent debt and housing crisis.

Read the rest of this piece at Spiked.


Joel Kotkin is the author of The Coming of Neo-Feudalism: A Warning to the Global Middle Class. He is the Roger Hobbs Presidential Fellow in Urban Futures at Chapman University and Executive Director for Urban Reform Institute. Learn more at joelkotkin.com and follow him on Twitter @joelkotkin.

Photo: Paul Farmer, via Geograph.org.uk, CC 2.0 License.

Dumb and Dumber

By: Jane Wells
On: Wells Street

One of the funny things about being human is that no matter how successful we are, we always end up doing something stupid. I prove this point hourly. The hope is that over time we learn from our mistakes and don’t repeat them.

But who am I kidding?

So let’s get to it! Here’s a summary of dumb moves from Wall Street to Main Street to Tokyo. Read more

The New Labor Crisis is the Biggest Opportunity in a Generation

The COVID-19 pandemic has left pain and tragedy in its wake. But it has also created a unique opportunity to address the country’s persistent class divides, thanks to a persistent lack of labor resulting from the pandemic. In a world economy that has seen labor’s share of income drop for generations, this labor shortage could provide some restored leverage for both white and blue collar workers.

Read more

The (Next) Great Migration

By: Here Comes Everybody Podcast
On: The Solo Project

“The great thing about this migration is the ability for reinvention. And the ability for reinvention is directly tied to innovation and entrepreneurship.”

Kotkin has written about every conceivable form of entrepreneurship. He is, in fact, a career soloist himself.

These days, it seems that everyone — and in particular soloists — are moving somewhere.

In this episode, Kotkin tells us exactly where we’re going — and why.

 

Related:

Buy Joel’s latest book, The Coming of Neo-Feudalism
The Politics of Migration: From Blue to Red
The Emergence of the Global Heartland

Joel Kotkin talks with John Anderson on Neo Feudalism and the New Ruling Class

By: John Anderson
On: John Anderson Direct

In this Direct interview, Joel Kotkin joins John to discuss some of the key theses of Joel’s widely-praised recent book, ‘The Coming of Neo-Feudalism’.

Joel shines the spotlight on the Western progressive elite or, as he terms them, the ‘new clerisy’, who sideline and silence anyone who speak or, increasingly, think against the orthodoxy. He paints a worrying comparison between this status quo, the Chinese experience of authoritarianism and the medieval feudalism known to Europe for hundreds of years.

 

 

Related:

Buy The Coming of Neo-Feudalism
Winners and Losers: The Global Economy After COVID
Fully Oligarchic Luxury Socialism
China’s Urban Crisis
China’s Troubled Urban Future

John Anderson, former Deputy Prime Minister of Australia, interviewing the world’s foremost thought leaders about today’s pressing social, cultural and political issues.

Fully Oligarchic Luxury Socialism

What happens in California matters well beyond its borders. The Golden State’s cultural and technological influence on America, and the world, now could provide the nation’s next political template.

What California is creating can be best described as oligarchic socialism, a form of collectivism that combines hierarchy with “equity,” regulation with oligopoly, and progressive intentions with feudal results. Read more