What working class?

In the first of series of posts on Marxism, John Quiggin goes in search of the revolutionary working class.

It takes Professor Q an entire paragraph to establish that no such class exists and that the revolution is off.

Most Marxists (and recovering Marxists) seem to have come to terms with this. But some still insist that nothing short of revolution can save society from the miseries of oppression, exploitation and alienation. Their careers are dedicated to establishing the causes of this misery and the reasons why reform is hopeless.

While Quiggin rejects the idea of a revolutionary working class, he doesn’t reject the idea of class. As he explains in his post:

… there clearly is a self-conscious and generally dominant class, centred on control of capital, but including plenty of people whose source of power and wealth is derived from their job rather than from capital income. On a narrow definition, it includes the top 1 per cent of US households which now receive 25 per cent of all income and hold around 35 per cent of all wealth. More broadly, the top 20 per cent of the population has, in broad terms, increased or maintained its share of national income as the top 1 per cent have become richer. This broader group controls more than half of all income and wealth.

Most of the political elite in developed countries, but particularly in the US, consists of members of the top 1 per cent, or aspirants to rise to this group from the top 20 per cent. Moreover as well as controlling much of the political process through direct participation or political donations, this class exercises power directly through ownership of capital and particularly through control of the financial system.

It turns out that almost everyone in the bottom 80 per cent would benefit from policies designed to curb the power of the top one per cent. And an egalitarian political movement might also appeal to the "broader interest of those in the top 20 per cent of the population in a juster and more stable social order" after all "unlike the top 1 per cent, this group can’t easily insulate themselves from society as a whole or count on passing on their own social position to their children."

The trouble is, there’s no political party or organisation ready to step up and lead the movement. Social democratic parties "seem either hopelessly compromised or ineffective, while the Greens seem to be stuck as a permanent minority." And this is where Quiggin seems to run out of puff. What comes next?

Hang on … what do you mean by working class?

Quiggin’s argument about class is influenced by G.A. Cohen’s book If You’re an Egalitarian How Come you’re so Rich. According to Cohen:

The communist impression of the working class was that its members

1. constituted the majority of society;
2. produced the wealth of society;
3. were the exploited people in society; and
4. were the needy people in society.

There were, moreover, in the same impression, two further characteristics consequent on those four. The workers were so needy that they

5. would have nothing to lose from revolution, whatever its upshot might be;

and, because of 1, 2 and 5, it was within the capacity (1, 2) and in the interest (5) of the working class to change society, so it

6. could and would transform society.

Quiggin argues that after we exclude business owners, people on welfare and non-needy workers, we’re well short of a majority. And it seems that any definition of the working class that stretches to a majority will include many people who are not exploited or desperately needy and therefore do have something to lose from revolution (Luke Roelofs has more on this).

However, if Cohen’s four features that define the working class, Quiggin has an idea:

… the case to be made against the top 1 per cent is that:

1) They constitute a tiny minority of society
2) they consume far more of the wealth of society than they actually contribute
3) they exploit their control over capital for their own benefit
4) they are the primary obstacle to meeting a wide range of social needs

Which reminds me of the curious incident of the dog in the night-time.

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46 Responses to What working class?

  1. Patrick says:

    It turns out that almost everyone in the bottom 80 per cent would benefit from policies designed to curb the power of the top one per cent. And an egalitarian political movement might also appeal to the “broader interest of those in the top 20 per cent of the population in a juster and more stable social order” after all “unlike the top 1 per cent, this group can’t easily insulate themselves from society as a whole or count on passing on their own social position to their children.”

    Really? Is this actually so? How?

    I couldn’t quickly find a free version of the Hochschild paper, but it looked interesting. I’ll try and remember to try again.

  2. John Passant says:

    Ah yes, the revolution is off. Just ignore the Middle East and North Africa and Europe.

  3. Patrick says:

    It’s hard to see those revolutions as a vindication of working class theory…aren’t the ME protesters asking to be subject to greater capitalist oppression not less?
    As is the current generation of South Americans…

  4. murph the surf. says:

    Europe?
    I like the manner in which China is described as being something other than lead by marxism.It has chinese chararcteristics you must remember.
    A new party or political force ( is there still a need for a ‘vehicle’ to transport ourselves in? Where will the vanguard be? ) based on “having a red hot go” at the rich might make some wonder if there isn’t a sort of revolution in search of a philosphy basis to this analysis.
    If it is accpeted by marxists that change isn’t inevitable now why the persistence of the desire for revolution in what is really an alternative elite?

  5. Pedro says:

    Where to claims 2 and 4 come from. The wealthy are only an obstacle to govt spending if you think they stole their money and now they mobilise powerful forces to stop it being taxed. Claim 2 looks like Quiggan is fussing around with the labour theory of value.

  6. Incurious and Unread (aka Dave) says:

    Can I suggest two societal changes in the last generation or two that might account for the failure of the working class to vote/act in its own interests?

    Firstly, increased social mobility (and, with it, “aspiration”). Those hoping to improve their condition are more likely to aim to do this individually rather than as a class. The ruling class is able to prey on this “aspirationism” by arguing (falsely) that equitable policies reduce mobility and opportunity.

    Secondly, the increased dominance of the media as a tool for the ruling class to manipulate the “consciousness” of the working class.

  7. AKA Dave is right in the sense that cross-sectional data on which inequality stats are based gives a misleading sense of people’s longer-term situation – far more people are experiencing low-income at a single point in time than are low-income in the long term.

    But though it is less true in the US than elsewhere in the West, democracy has had the expected effect – the rich have been taxed, and the money redistributed to the people who are poorer at that time, in both direct and in-kind benefits.

    Sometime in the 20th century we had an important historical transition, where instead of the rich living off the poor, the poor started living off the rich.

  8. Mel says:

    AN says: “Sometime in the 20th century we had an important historical transition, where instead of the rich living off the poor, the poor started living off the rich.”

    Only in your feverish imagination.

  9. In the feverish imagination of the ABS. Nearly three-quarters of households in the bottom 20% of the income distribution have government benefits as their principal source of income, and nearly a quarter of the next quintile.

  10. conrad says:

    “Only in your feverish imagination.”

    And God save the Queen, and all those poor (in both senses of the word) Chinese workers in factories. Perhaps the distribution in who lives off whom is different.

  11. observa says:

    Quiggin looks in the mirror and discovers his graduazzi class. Hallelulah!

  12. Mel says:

    AN says: “In the feverish imagination of the ABS. Nearly three-quarters of households in the bottom 20% of the income distribution have government benefits as their principal source of income, and nearly a quarter of the next quintile.”

    Yes but many in the top 5% earn their income by directly or indirectly parasitising on the households that earn less.

  13. john walker says:

    Mel we are all sinners, very clever very destructive monkeys rich and poor

  14. Paul Frijters says:

    we have been at this issue many times at clubtroppo. For my money, the support for policies that benefit only the super rich in Western countries is all about aspirational voters. The poor may be poor, but many of them prefer to think of themselves as belonging to the group of winners.
    The problem with selling the idea of solidarity amongst the losers is that people do not want to think of themselves as losers and will be susceptible to stories by the winners that envelope them. The mining tax was a great example of this, as was the quick forgiveness granted to the bankers who got us in the GFC (and the quiet demise of all talk of going after bonuses). It is not that there are no politicians and parties who fail to try the argument, but rather the idea simply gets no traction amongst the voters.

  15. Pedro says:

    Maybe because most people instinctively realise that those are bad ideas. Chasing after bankers’ bonuses was a clearly not a good idea. The mining tax was an idea full of holes and was poorly done. The fundamental misrepresentation that the minerals belong to all Australians pretty much sums up the problem.

    Mel, exactly how is that parasitism expressed?

    Those chinese workers might be poor (or poorish), but they are not slaves and they are being paid according to productivity and are therefore on the way up.

    http://www.asiasentinel.com/index.php?option=com_content&task=view&id=2304&Itemid=214
    http://www.bloomberg.com/news/2010-06-07/china-wage-increases-to-damp-foreign-investment-bofa-merrill-lynch-says.html

  16. Mel says:

    Pedro:

    “The fundamental misrepresentation that the minerals belong to all Australians pretty much sums up the problem.”

    That’s right, Pedro. If a small number of boneheads are allowed to make obscene profits by thieving something that rightly belongs to us all then they are parasites. Unfortunately current arrangements legitimate such parasitism.

  17. Paul Frijters says:

    thank you for proving my point so quickly, Pedro. The myth that everybody deserves what they get is exactly the sort of thing only the top 1% should believe.

  18. Fyodor says:

    The problem with selling the idea of solidarity amongst the losers is that people do not want to think of themselves as losers and will be susceptible to stories by the winners that envelope them.

    Shorter socialist: youse are all stoopid losers.

  19. Nicholas Gruen says:

    Virtually everyone has something to lose from revolution. In fact I can’t think of anyone in whose interests it would be in Australia. Revolutions have a very good chance of being catastrophic. Which means bad news for virtually everyone. There would, of course be some winners, but you’d have a pretty bad chance of being that person or within the small group of people who’d be winners in terms of power or wealth.

    On a less grave note, people seem inherently well disposed to the idea that the rich need lots of incentives to make the system go. Kate Moss needs to keep most of the 20K she needs to get out of bed in the morning. Otherwise . . . well she mightn’t attend the photo shoot, and then where would society be?

    Perhaps it’s aspirational, but it’s hard to see any wealthy countries in which there’s a strong move towards higher marginal tax rates for the rich. Strange, but (unless I’m missing something in Europe or somewhere) true, I think.

  20. Pedro says:

    Paul, Will Munny said it best: “Deserves got nuthin to do with it.” I can’t think of any way of considering the world or economic outcomes in which “deserves” can be sensible applied. I’m just an upper middle class schulb working to support my family and at least one other, and perhaps a pensioner couple, judging from the tax we pay as a family. Now, we’re clearly not on struggle street, but I can’t think of a single reason that anyone could say we don’t deserve a greater share of our income.

    Mel, the minerals don’t belong to all Australians, they belong to the various States. That’s a simple constitutional fact that you snarkily seem to want to ignore.

  21. Victor Trumper says:

    Pedro,

    Who taxes the super profits?

  22. Fyodor says:

    Who taxes the super profits?

    What “super profits”, Homerkles?

  23. Victor Trumper says:

    wrong person but right ISP.

    another topic you are all knowledgeable about but know nothing.

    Remarkable

  24. Fyodor says:

    I couldn’t give a toss about your ISP, chum.

    Are you saying that you’re NOT the Farnarklist Formally Known as Homer Paxton? You’re doing a “remarkable” impersonation if you’re not.

    You could answer the other question while you’re at it.

  25. Pedro says:

    Not counting the spelling, it sure reads like you Homer.

    As for the super profits, who cares. The point is not that there should or should not be a particular level of tax on mining, but that the failure to understand the constitutional realities of our federation leaves a whopping great flaw in the design of the proposed tax. A flaw that continues to exist and which highlights the stupidity of the “all Australians” misrepresentation.

    I would hope, as a Qldr, that my stupid state govt is selling our coal or whatever for the best price that can be achieved thus minimising the profits of the people buying it from us.

  26. Nicholas Gruen says:

    You guys do know don’t you, that though the states ‘own’ the resources, if they tax them almost all of it gets recirculated to the rest of the Cth via the CGC? So another way of putting it would be to say that the states own the resources subject to an ~80% Cth tax on the rent the state charges for them!

  27. Mel says:

    Pedro, my point isn’t about law and constitutionalities.

    My point is an ethical one- the greater good would be served by distributing the profits gained by selling things that are easily dug up out of the ground to everyone, rather than allowing folk like the Two Fat Miners- Clive Palmer and Gina Rhinehart- to gorge themselves until they puke.

    The two fatties should not have the right to eat the whole cake, leaving only crumbs for the rest of us.

  28. Fyodor says:

    My point is an ethical one- the greater good would be served by distributing the profits gained by selling things that are easily dug up out of the ground to everyone, rather than allowing folk like the Two Fat Miners- Clive Palmer and Gina Rhinehart- to gorge themselves until they puke.

    You economic illiteracy can be dismissed out of hand, but I’m curious about the claim that your argument is ethical. How did you arrive at this “ethical” calculation of the “greater good”, Mel?

    The two fatties should not have the right to eat the whole cake, leaving only crumbs for the rest of us.

    Why do you think you deserve more than crumbs from wealth that you did not create?

  29. JC says:

    Homes asks

    Who taxes the super profits?

    The ATO does Homes. You know that. If they make more money they pay more tax.

    Mel

    There’s lot’s a thin billionaires too.

    Clive would be exactly the same weight even if he were worth a tiny fraction of what he is, because I don’t think you need a ton of money to maintain that girth. There’s no such thing as a girth/wealth ratio in oz at least.

  30. John Quiggin says:

    I like the illustration! I assume it’s Lenin’s suit I (or the me of 20 years ago) has been photoshopped into.

  31. wizofaus says:

    It’s hard to see how claims of “the rich living off the poor” or vice versa are particularly constructive. The fact that every developed economy in the world does have a tax-and-distribute system and the vast majority of us agree on the need for such a thing is pretty good indication that we accept that a purely market-based determination of value-creation is unworkable, for whatever reason. So surely it’s just a question of the degree to which as a whole we feel it needs to be adjusted. Personally, for a number of reasons, I’m generally in favour of more redistribution than we currently have in Australia (*), even though it would almost certainly leave me personally less well off. Others feel differently. Democracy seems to be the only reasonable way to decide how much we want, and given our two major political parties are barely offering us much of a distinction in this field, I guess Australians are on the whole more or less OK with the degree of redistribution we have.

    (*) I’d probably be slightly unusual in wanting to see this financed purely by less government spending in other areas. My faith in governments to provide quality services at a reasonable cost in this country has definitely faded in recent years, but I’m more convinced than ever that markets make poor judgments of deserved/just income.

  32. Pedro says:

    Yes Nicholas, but surely that is best regarded as a defect in the grants commission concept and it hasn’t stopped Barnett.

    We either remain a federation or we’ve somehow, and largely unnoticed, morphed into a single pseudo republic with 3 levels of govt structured for the dispersed distribution of services subject to central control. Oh wait, that’s exactly what has happened.

    Nice one Mel, picking on the fat kids now! But seriously, have a look at the long term with the mining industry. Those guys slog along for years doing ok, but not spectacularly, and now when prices go up and they have their day in the sun suddenly you think them thieves.

    To the extent the term is meaningful, markets necessarily make the best determination of deserved income. Justice is another question and is very much in the eye of the beholder. Some people think redistribution is just and others think it merely necessary.

    I’m not sure we decide anything as a whole, or even democratically as the choice offered is not very wide.

  33. Victor Trumper says:

    wrong person JC.

    no the ATO or Federal government taxes profits not super normal profits.
    Such a tax is essential when commodity prices are at an all time high as merely cutting government spending is simply not an option.

    Unfortunately for Pedro the States cannot!

  34. Fyodor says:

    Heh. Homerkles the ALP shill quotes another ALP shill as his authority. Nice one.

    There’s nothing “essential” about the government appropriating shareholders’ equity, Homer.

  35. JC says:

    Such a tax is essential when commodity prices are at an all time high

    Really? So to use your principle and extend it a little further, the government ought to supertax the sale of your house seeing it’s likely to have hit its all time highs. You know why obviously, because cutting spending

    is simply not an option.

    There is a super tax, Homer. It’s 30% on all profits and if you make a lot of dough, the firm pays a ton of tax.

    Unfortunately for Pedro the States cannot!

    Umm why? In any event there was no outcry from the states before the manufactured crisis in our tax system.

  36. Pedro says:

    “Unfortunately for Pedro the States cannot!”

    Right back to form Homer. How exactly are the States unable to extract higher revenues from mining price booms? Gee, what did Barnett just do? I’m glad to see you’re finally taking spelling and grammar seriously.

  37. Don Arthur says:

    John Q – Yes, it’s Lenin. Alexander Gerasimov’s Lenin on the tribune.

  38. Mel says:

    Norway has ensured that much of the profit from its North Sea Oil reserves is used for the “greater good” by funding their welfare state. They don’t appear to labor under the delusion that whoever performs the relatively rudimentary task of extracting riches from the soil has “created” wealth. I’d like to see the same perspective applied to Australia’s buried treasures. If such an approach puts a frown on the face of the two gluttonous fatties, Clive and Gina, so much the better.

  39. Victor Trumper says:

    Having Cha again and so reading this unfortunately.

    Fyodor,
    I answered as much as I will of who I am previously. If you were too lazy to see my response then I am sorry I am not going to repeat myself.

    your second question is stupid.

    here is another ALP shill.

    It would have been nice to address the issue but that was asking a little too much. Why don’t you migrate to Catallaxy.
    It is full of men who have your insecurity, puffed up self importance , little understanding of any topic but always supercilious on any.

    There is no tax on super-normal profits as there should be.oh I cannot sell anything as I do not own anything of note.

    Pedro,
    Your understanding of basic economic issues is severely lacking.
    Mr Barnett cannot tax profits he can only tax production. That is why most if not all economists support a tax on profits not production.
    you can read about it here.

  40. jc says:

    Mel

    Please compare like with like.

    Our oil patches are taxed like norways.

    Mining is not the same as oil drilling. You requie a ton of capital for mining compared to oil.

    That’s why dividends are pathetic… bhp and rio around 2.5%..
    while the rest of the money is retained earnings and ploughed back to finance capital expendiure.

    As for the greater good theory… Best to raise the thresholds on super.

    Homes

    Stop holding grudges. After the skanke ho shamblio you created I don’t know how you can criticize anyone.

  41. Fyodor says:

    Norway has ensured that much of the profit from its North Sea Oil reserves is used for the “greater good” by funding their welfare state. They don’t appear to labor under the delusion that whoever performs the relatively rudimentary task of extracting riches from the soil has “created” wealth. I’d like to see the same perspective applied to Australia’s buried treasures. If such an approach puts a frown on the face of the two gluttonous fatties, Clive and Gina, so much the better.

    Ah, yes: Norge. Every time resource taxation comes up the probability of some ignorant socialist shouting out “BUT-BUT-BUT…NORWAAAAY!” approaches one.

    Coupla points here:

    1. There’s a lot more money available for the “greater good” when you produce more oil per capita than Saudi Arabia. Australia is in a different league altogether, so yours is a stupid comparison.

    2. The Norwegian government invests directly in the Norwegian oilfields and owns the controlling stake in the dominant producer, Statoil. Unless you’re suggesting our government fork out big bikkies to buy out large chunks of BHP and Rio Tinto, yours is a stupid comparison.

    3. The Norwegian government taxes the buggery out of oil producers, but as it is the dominant producer, it’s largely taxing itself, so yours is a stupid comparison.

    4. The bulk of the money raised from the oil industry goes into the Oljefondet – the government pension fund – not funding the welfare state, so yours is a stupid comparison.

    5. The billions in royalties and taxes collected from the mining sector by Australian state and federal governments ALREADY fund a large chunk of Australia’s welfare state, so yours is a stupid comparison.

    So, to sum up: your comparison is stupid.

    Not only, but also: if you think digging up riches is “rudimentary”, get to it. That way the rest of us could benefit from your undoubted entrepreneurial genius and generousity with other people’s money.

  42. Fyodor says:

    Fyodor, I answered as much as I will of who I am previously. If you were too lazy to see my response then I am sorry I am not going to repeat myself.

    Yairs, it’s pretty clear who you were previously.

    You do realise, don’t you, that when you torture the language like this you prove without doubt that you are Homer Paxton?

    your second question is stupid.

    Do you mean the second question you just answered by not answering it in a way that answered it, or the first question you didn’t answer after I asked it a second time?

  43. Ken Parish says:

    Dear Homer in denial (#40),

    There is no constitutional bar to the States or Territories taxing mining profits (as opposed to production volume). The Commonwealth might seek to punish a State that did so through reduction of its s 96 grants, but they’d have to get it through parliament which is unlikely in the current scenario anyway.

    That isn’t to suggest that there’s anything wrong in principle or practice with a resource rent tax of the sort and size currently proposed by the Commonwealth, except that it should be broader based (i.e. not just applyng to iron ore and coal).

  44. FDB says:

    Having Cha again and so reading this unfortunately.

    Oh Homer.

    What a weird experience it must be, pretending you’re not yourself while everyone knows the truth. I don’t envy you.

    Your writing as ‘Victor Trumper’ may seem, to you, to be passable-off as just anyone’s work, but try to remember that not everyone shares your disregard for grammar and coherence. To the rest of us, writing style is a handy way to spot sockpuppets or pseudonym-changers, and yours sticks out like dog’s balls.

  45. Pedro says:

    Beat me to it Ken. As a WW2 aficionado (albeit barracking for the wrong team), you’d think Homer would remember how the Feds got control of the income tax. And you are doubly wrong Homer because a wholesale royalty can also be adjusted to reduce profits (and yes I know that will impact on the marginal mines) or could be calculated on a partly profit share basis without being an income tax.

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