I can remember writing in the ’90s and early 2000s that one of the great things about the United States was our economic mobility. By that term, economists mean the ability of people to shift around on the economic spectrum – to move from being a low-income family to being a high-income family, for example. Karl Marx, in the 1850s, even cited the US as an exception to his struggle-of-the-classes theory, because the economic classes in the US kept changing so much.
The last few years have seen a flurry of studies asserting that this mobility is no longer the case. That is a very uncomfortable fact for me – it cuts right into my emotional comfort zone. If that is true, then the America I grew up in is changing. Which of course should not surprise me because (a) the US is always changing and (b) the evidence in front of my eyes about cultural shifts and the economic difficulties of the younger generation is readily apparent.
An old friend of mine sent me the essay you’re about to read. It’s by Frank Buckley, who is a professor at the Scalia Law School at George Mason University. It appeared in the Hillsdale College publication Imprimis.
Outside the Box is supposed to make you think, even when it is uncomfortable to do so. And Buckley’s essay will make many Americans uncomfortable, even as it allows my Canadian friends to continue to feel smug and superior (although they are always too polite to flaunt it).
What Buckley demonstrates is that the political devolution we have seen in the US in recent years and that has come to a head this year in the form of the Trump and Sanders candidacies, is actually a confirmation of Marxist theory (though Buckley himself is hardly a Marxist). We have erupted into what is essentially class warfare, at least in the political realm. Okay, we all get that middle-class America has been left behind and that the Protected Classes, whether they are Republican or Democrat, have made sure they do well. When you have economic and social mobility, you have a country in which there are social differences, but they are not so extreme that a large portion of the populace becomes disenfranchised and radicalized. Buckley says of today’s America:
That is the country in which some imagine we still live, Horatio Alger’s America – a country defined by the promise that whoever you are, you have the same chance as anyone else to rise, with pluck, industry, and talent. But they imagine wrong. The U.S. today lags behind many of its First World rivals in terms of mobility. A class society has inserted itself within the folds of what was once a classless country, and a dominant New Class – as social critic Christopher Lasch called it – has pulled up the ladder of social advancement behind it.
Then he makes me decidedly uncomfortable. He goes right to the research and demonstrates that the United States is way behind most of the rest of the developed world in terms of economic mobility. The irony is that much of the reason for this lack of mobility is what we consider to be “progressive” policies, although our conservative policies are also exacerbating the situation, or at least seem to be doing so in comparisons with other countries.
Buckley’s prescription? I’ll let him develop his argument for you, rather than spill the beans.
(Sidebar: I did a little research on Buckley and came across the fact that he was born in Saskatchewan, which might excuse him for his home bias toward Canada – though it doesn’t weaken his argument.)
I think I have to agree with Thomas Jefferson, who famously said:
I hold it that a little rebellion, now and then, is a good thing, and as necessary in the political world as storms in the physical.
The ’60s hippie in me sometimes feels like it is once again time to storm the barricades. Just saying…
Our dinner with Jeff Saut (the Chief Investment Strategist at Raymond James) Sunday night was fabulous, and the conversation was wonderful. Jeff has spent a very long career (we are the same age) very successfully and publicly picking stocks. While Jeff and I have been friends for many years, I have never really asked him about his investment process, and over steaks and mushrooms I took the opportunity.
He gave me a number of examples of his process over the years. What it boils down to is that he hangs around with incredibly good stock pickers and gets them to share their ideas, and then follows up with his own research. I began to ask, well, who did you get this from, and how did it come about that you got to meet him?
After about an hour of this, I turned to Shane and said, “You have just witnessed one of the greatest instances of name dropping that you will ever encounter.” Jeff was only doing it in response to my questions, and I knew he was connected – but dear gods, he has a network that is phenomenal. It’s like he has a direct pipeline to the gods of investing. Part of it is that, like me, he has hung around for 67 years, is a nice guy who meets a lot of people, and is willing to share his ideas freely. I am trying to figure out how to get him to my conference.
Your wondering how we turn this thing around analyst,
John Mauldin, Editor
Outside the Box
Restoring America’s Economic Mobility
By Frank Buckley
Originally published in Imprimis, September 2016
The following is adapted from a speech delivered on July 11, 2016, at Hillsdale College’s Allan P. Kirby, Jr. Center for Constitutional Studies and Citizenship in Washington, D.C., as part of the AWC Family Foundation Lecture Series.
In the Communist Manifesto, Marx and Engels wrote that “the history of all hitherto existing societies is the history…