The Crisis of the Middle-Class Constitution. Ganesh Sitaraman. 2017.
The author, from the Vanderbilt Law School and the Center for American Progress, maintains that the number one threat to American constitutional government today is the collapse of the middle class. To make his case, he reviews the interplay of constitutional theory and the conflict of economic classes throughout history with special reference to the novel aspects of the US Constitution, which is a middle class constitution.
From the ancient Greeks onward, political philosophers were preoccupied with the problem of economic inequality and its relationship to the structure of government. They sought to prevent the clash of wealthy elites with everyone else from leading to the rich oppressing the poor or the poor seeking to confiscate and redistribute the wealth of the rich. In ancient Athens, from the time of Solon in 594 B.C. until 403 B.C., requirements for holding political power evolved from birth to wealth to geography to citizenship alone. In the next century, the golden age of Athens, democracy flourished. All 20,000 to 30,000 (male) citizens were entitled to direct participation. Leaders were selected by lottery rather than elections to eliminate advantages for wealthy or privileged elites. The majority of citizens who participated were essentially from the middle class.
This pattern changed for the great republics that followed throughout history, including Rome, Florence, Venice, and England. All had what the author calls class warfare constitutions that entrenched economic class into the structure of government in the hope of preventing instability, class warfare, and revolution. According to Aristotle, the best achievable constitution was what he called a middle constitution, but it required balancing of the interests of the rich and the poor by a strong middle class, such as was present in Athens. Aristotle also described what the author calls a class warfare constitution in the absence of a strong middle class. In this system, checks and balances are created between the rich and the poor by awarding divisions of government according to class, like today’s House of Lords and House of Commons. This became a dominant form of constitution for republics for the next two millennia.
The history of the ancient Roman Republic provides an example of the operation of a class warfare constitution. Around 493 B.C., a struggle between the patricians and plebeians eventually led to the formation of the plebeian assembly and tribunes to balance the aristocratic senate and consuls. Eventually this separation of political powers between economic classes failed to prevent major political instability because its provisions were not enforced. Over the centuries, the elite class of large landowners took control with impunity of more and more of the vital public lands they shared with plebs. Beginning in 133 B.C., first one then another of the Gracchus brothers became a tribune and was killed along with many followers when addressing this land use issue with land reform. In the century of extreme violence that followed, the Republic fell to a succession of strong leaders as Rome descended into class war, civil war, and finally rule by the Caesars.
During the two thousand year history of republics with class warfare constitutions that followed, scholars such as Polybius, Cicero, Machiavelli, Giannotti, Harrington, Hume, and Montesquieu continued to consider the problem of creating a constitution that would provide stable government by managing class conflict. In Florence of the 1530s, Giannotti revived the concept of Aristotle’s middle constitution for stable government. He concluded that mixed governments were unstable because of the inevitability of winners and losers in issues between the rich and the poor. He observed that if the emerging mediocri (middle class) in Florence could become strong enough it could hold the balance of power and make stable mixed government possible. In England in 1656, Harrington noted that political power follows economic power and that an economically unequal society could not be politically equal. In France in 1748, Montesquieu, known also for his theory of separation of powers, recognized that reasonable equality was essential for well-functioning government. He therefore suggested establishing outer bounds of wealth and then passing laws that will equalize inequalities through burdens they impose on the rich and relief they afford to the poor.
In the US in 1787, the founding fathers broke with tradition and created a middle class constitution, rather than a class warfare constitution as had been the norm for republics since ancient Rome. This change was influenced by centuries of constitutional scholarship, the ideals of the Enlightenment, and the unique American economic circumstances. In 1774, early America was astonishingly equal due to an agrarian society with widespread small property holdings and a boundless frontier. At that time America was considerably more equal than it is today. In 1774, the top 1% of households had just 8.5% of total income or 7.6% when only free households are included, while in 2012, the top 1% had 19.3%. Thus the existence of a strong middle class facilitated the balance of power between the rich and the poor needed for a middle class constitution.
In this constitution, the separation of powers was between the branches of government, rather than between the economic classes. Hence, there was no formal provision for special powers for property that would facilitate evolution of a landed aristocracy. Nevertheless, sceptics still feared capture of government through informal means if an elite group with shared beliefs managed to control all the parts of government. Thus a prerequisite for this government is a continuation of the reasonable equality and the strong middle class present at the time of its establishment to maintain the balance of power between the rich and the poor.
The first obstacle to this balance for the middle class was the regional institution of slavery. Although America was quite equal overall in 1774, this was not the case in the South. The slave-owning South in 1774 had almost exactly the same high level of inequality as the US does today. This problem was partly addressed by the Civil War and the 13th, 14th, and 15th Amendments. However, efforts to provide equality of the freedmen after the Civil War were undermined by political and Supreme Court maneuvers against reconstruction and by a southern reign of terror that included disenfranchisement, night raids, the KKK, and guerrilla warfare.
The next challenge to the middle class was the transformation from an egalitarian agrarian society into a more unequal urban society due to the industrial revolution and the closing of the western frontier. Inequality increased greatly as urban wage-laborers found themselves at the mercy of the plutocrats of the Gilded Age. Progressives like Teddy Roosevelt responded with constitutional amendments democratizing the country, corporate and income taxes, antitrust laws, campaign finance reforms, and professionalization of government officials. These changes were not enough. Subsequently, the World Wars, Great Depression, New Deal policies, and unionization were necessary, as well, for return to reasonable equality and a strong middle class that lasted from the 1940s to the 1970s.
During this golden period, the share of income for the top 10% fell from 49% to 35%; the share of wealth for the top 0.1% fell from 25% to 10%; home ownership rose from 44% to 64%; and male worker’s wage increases of 96% kept pace with productivity increases of 108%. Government policies critical to rebuilding the middle class included the GI Bill, funding for growth through infrastructure and basic research, regulation for financial stability like Glass-Steagall, the FDIC, and the SEC, progressive taxation, Medicare, and Medicaid. Additional policies with middle class support enhanced the quality of life, such as regarding safety, civil rights, and the environment.
Inevitably, the plutocrats counterattacked under the banner of neo-liberalism. Since the Reagan Revolution of the 1980s, policy choices, globalization, technology, and capture of government by wealth have caused inequality to again soar to the level of the slave-owning antebellum South and the Gilded Age. From 1979 to 2008, 100% of income growth went to the top 10%, and income for the bottom 90% actually declined. From 1976 to 2014 the share of income for the top 1% grew from 9% to 21%. By 2014, the twenty wealthiest individuals were wealthier than the bottom half of the US population. From 1979 to 2013 CEO’s salaries rose from 30 to 296 time those of their workers. An IMF study found that the decline of unionization contributed to about half the rise of inequality from 1980 to 2010. As the US has become stratified by wealth, inter-generational economic mobility has decreased substantially.
All of these changes have greatly reduced the size, income, and influence of the middle class to balance the excesses of the rich. From 1970 to 2012, the middle class decreased from 65% to 41%, while the affluent increased from 7% to 16% and the poor increased from 8% to 19% (Reardon and Bischoff). The threats to the republic from this destruction of the middle class come in two forms: 1. Oligarchy or oppression of the poor by the rich and 2. Populist authoritarian demagogues leading overthrow of the rich by the poor. (Amazingly, the Trump campaign managed to divert the latter to service of the former.)
According to Jeffrey Winters, who has spent a lifetime studying oligarchs, the US is already a modern oligarchy. With increasing inequality, the wealthy isolate themselves from the rest of society by purchasing their own elite education, living conditions, protection, and other services. As their social empathy drops, they are less likely to support programs for the public good that benefit others unlike themselves. Hence many of them press for smaller government to avoid taxes, evade regulations, and defund social programs that benefit the general public. They have used their enormous resources to provide extensive funding for lobbying, political campaigns, ideological think tanks, and media that serve their perceived interests, particularly since the Citizens United decision of 2010.
These efforts have been spectacularly successful in achieving rule by the economic elite rather than by the majority. Right wing and libertarian ideologues first gained control of the Republican Party, then by 2016 all three branches of the federal government (as feared by the founding fathers). For the congressional and executive branches, a study of 1779 government policy outcomes over two decades showed that across all areas they overwhelmingly reflected the preferences of the affluent and business groups and that the views of the middle class and the poor had no influence at all (Gilens). For the judicial branch, the five conservative judges on the Supreme Court prior to Justice Scalia’s death were in the top ten of the most pro-business justices in history. Groups that are best able to get their cases to the Supreme Court are pro-business, anti-regulatory, and ideologically conservative.
Three options for dealing with the crisis of the middle class constitution are discussed: 1. Accept the status quo and adopt a class warfare constitution. This is not going to happen for obvious practical reasons and because it is antithetical to American tradition. 2. Safeguard the political process by severing the link between economic power and political power, such as by campaign finance law, prevention of regulatory capture, and an increasingly professional civil service. This approach is unlikely to succeed because of the “hydraulic problem” (money for influence blocked in one channel will find another) and the “paradox of process” (the well-to-do are better equipped with lawyers and lobbyists to navigate political and regulatory processes). 3. Rebuild the middle class through a complex process including tax policy, wage and benefit policy, education, structural reform in business and finance, corporate long-termism, a new labor movement, and prospective self-correcting mechanisms such as automatically triggering relevant laws when inequality reaches a certain level.
The most significant obstacle to these reforms is the problem of foxes guarding the hen house (government by economic elites). The author suggests that progress may be made by finding and supporting individuals in government not yet captured, social movements with mass mobilization, and facilitation of change during emergencies. In any event, saving the Republic will require the Republican Party to reclaim its tradition of progressive conservatives who believe in reform to preserve the best American traditions without radical change.
5. The Crisis of the Middle Class Constitution (evolution of constitutions to deal with inequality)
