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The Coming of Neo-Feudalism—A Review

Review of The Coming of Neo-Feudalism: A Warning to the Global Middle Class by Joel Kotkin, Encounter Books (May 2020) 288 pages.

Writing books which make bold predictions about the future of the Western world can be risky, so I naturally approached Joel Kotkin’s The Coming of Neo-Feudalism: A Warning to the Global Middle Class with caution. Could feudalism really be making a comeback in the West, as Kotkin argues? The answer might not be a straight “yes,” but Kotkin’s overall argument that deep currents of history and economics are pulling us towards a more stratified and ideologically orthodox society is persuasive. Particularly in light of recent events, as we shall see.

Feudal societies were hierarchical, with clearly-defined roles and responsibilities for everyone. The knights fought for all, the priests prayed for all, and the peasants worked for all. Times of upheaval could force open the door to social mobility, but otherwise, people kept their station. These barriers were broken down by the Enlightenment, the Industrial Revolution, and the rise of the modern democratic state. Now, Kotkin argues, some of this old stratification is returning. I’m not sure if the society he is warning us about is really feudal, as he doesn’t seem to be saying that the state will weaken—quite the reverse, in fact. But whatever we call it, it probably won’t be a society we like.

Kotkin writes of the medieval and early modern “Estates of the Realm”—the First Estate (Clergy), Second Estate (Aristocracy), and Third Estate (commoners). In the place of the clergy, we are seeing a new first estate which Kotkin calls the Clerisy—an increasingly detached intellectual elite found across government, the media, universities, and the professions. And in the place of the aristocracy, a new second estate, the Oligarchy. Just as the Clergy buttressed the wealth and power of the Aristocracy, so too does the Clerisy support the Oligarchy. People outside the new first and second estates are losing the opportunity to advance in life. In short, Kotkin’s neo-Feudalism rests on two pillars. One is growing and increasingly entrenched wealth inequality. The other is the cultural disconnect between the elite and the general population.

From Aristocracy to Oligarchy

Whereas the medieval Aristocracy owed their wealth to land and armies, Kotkin argues the new Oligarchy owes it to natural monopolies in the tech industry. Amazon now controls 90 percent of US ebook sales and 50 percent of paper book sales, replacing thousands of bookshops. This funnels revenue into the hands of those who work in the globalised technology sector, and in the secondary industries (like law and banking) which serve it. These new tech companies can make significant revenue with little labour. Google and Facebook make 300 times the revenue per employee that traditional firms like GM and Home Depot do.

Kotkin refers several times to French economist Thomas Piketty, who argued in Capital in the Twenty-First Century (2013) that wealth concentration is inevitable when the productivity of capital increases faster than economic growth. This is what we are seeing in practice. From 1945–73, the richest one percent of the population received 4.9 percent of total income growth. Now they get more than half. The richest 400 Americans own as much as 185 million other people. The wealthy have also been able to translate their wealth into land, something which the economy can never produce more of no matter how productive it becomes. From 2007–17, the 100 biggest landholders increased their holding from 27 million acres (an area the size of Maine and New Hampshire combined) to 40.2 million acres (an area the size of New England).

Kotkin examines the case study of California, the centre of the tech boom. California’s Gini coefficient of 0.49 makes it more similar to Latin American countries like Guatemala and Honduras than other Western countries like Canada and Norway (a Gini coefficient is a measure of inequality—a society with perfect equality would have a Gini coefficient of zero, while a society where one person owned all the wealth would have a Gini coefficient of one). He finds that there are patterns to this inequality. One is geography—wealth has increased much faster in the Bay Area and Los Angeles than in the Central Valley. Another is race—per the cost-of-living estimates of the Census Bureau, 28 percent of African Americans in California live in poverty compared to 22 percent of African Americans nationally. Kotkin argues that it is now practically impossible to buy a house in San Francisco unless you work in a high-paying job in the globalised economy or inherit the money from someone who previously owned a house in San Francisco themselves.

Conservatives and libertarians have historically argued that inequality of outcome is acceptable provided there is reasonable equality of opportunity. But it is true that a significant difference in equality of outcome for one generation leads to a larger gap in equality of opportunity for the next, and this can snowball over several generations. Kotkin persuasively argues that, as the high-tech globalised economy requires fewer people to generate more wealth, it is able to find them in fewer and fewer places.

From Clergy to Clerisy

Behind the Oligarchy is the “benign authoritarianism” of the Clerisy, those in government, the media, and academia who determine society’s orthodoxies. They view themselves as “more enlightened” than the majority, and tend to hold similar progressive views on the major political issues of the day. Kotkin cites studies suggesting that the ratio of liberals to conservatives in academia is 50–1, and at top schools anywhere between 8–1 and 120–1. These views are often at odds with those of poorer and less-educated people. As with the Oligarchy, the Clerisy has become more hereditary over time. Economic inequality and the cultural divide are obviously related. The Clerisy are educated at universities, and while more and more careers require a university education, the cost of that education per average American salary tripled from 1963–2013. The top universities, in particular, are limited to both the cultural and economic elite. Harvard, Princeton, Stanford, and Yale enrol more students from the top one percent of families by income than the bottom 60 percent.

The Oligarchy and Clerisy have broadly similar political views. Socially, they’re supportive of progressive politics and social justice. On economics, Kotkin argues they favour “oligarchical socialism,” including Universal Basic Income (UBI), public healthcare, education, and the like. I’m not sure “socialism” is the right word, as they still support private enterprise and free trade, but it is certainly true that they favour redistributive welfare. Andrew Yang’s presidential campaign, with UBI as its central plank, was obviously an example of the politics favoured by the tech industry and the Clerisy.

Progressives can reasonably point out that someone struggling to make a living in New York from three casual jobs isn’t in that predicament because the boards of Fortune 500 companies broadly support #MeToo and #BlackLivesMatter. And it would obviously be an oversimplification to suggest the Oligarchy and Clerisy hold one set of opinions and everyone else holds another. On some issues, such as same-sex marriage, society has shifted more broadly. And on others, such as the economic benefits of free trade and the risks of climate change from carbon emissions, some positions are simply much better-supported by the available evidence than others. But it would be foolish to suggest that the causes of populist anger against the elites are purely economic, or that economic issues cannot also have cultural aspects—measures to mitigate climate change tend to fall hardest on the poor and those in traditional industries, as Kotkin himself points out.

Where to for the Third Estate?

Finally, we have the third estate, which Kotkin divides in two. Some, whom he compares to the medieval yeomanry, are still doing okay in small businesses or trades. Amazon can’t compete with your barber or hairdresser. But many are stranded in unstable employment in the precarious gig economy—they’ve gone from Proletariat to Precariat. For them, upward mobility is stalling. 90 percent of people born in the 1940s went on to earn higher incomes than their parents, as opposed to 50 percent born in the 1980s. They may be supported by UBI and public welfare, but that would mean trading solid unionised blue-collar jobs for a life in a government-provided studio apartment watching Netflix. Understandably, faith in liberal democracy is declining in the Third Estate. Kotkin quotes the radical social theorist Barrington Moore: “No bourgeois, no democracy.” Economic inequality and cultural alienation leads to the rise of left- and right-wing populism. And, as in the Middle Ages, “peasant rebellions” like the gilets jaunes protests in France.

“The current ‘progressive’ approach to ‘social justice,’ with its attachment to a powerful central government, will only strengthen the clerisy by vesting more authority in the ‘expert’ class” Kotkin concludes. “On the other hand, the devotees of market fundamentalism, refusing to acknowledge the dangers of oligarchic power and the harm being done to the middle and working classes, might further a political trajectory that threatens the viability of capitalism itself.” However, he says, we can bend the “arc of history.” The solution is expanding opportunities for the working- and middle-class rather than promoting dependence, and correcting the lack of understanding or appreciation of the principles which make Western countries successful.

Here, Kotkin’s argument is not as strong. Both the Left and the Right seem to agree that it was better when a working-class man with a high-school education could spend his working life in a steady unionised blue-collar job which paid enough to buy a house, raise a family, and retire in security. But neither can agree on the solution, and I’m not sure if Kotkin has one either. Expanding opportunities for the Third Estate is easier said than done, and I can’t see it happening outside a government program like a subsidy for jobs or small businesses. The alternative is to save the jobs by regulating the economy to make it more inefficient, making the government the 21st century equivalents of the Luddites who tried to save the cottage textile industry by smashing mechanical looms. And I’d like to think I understand the principles which make Western civilisation successful, but this knowledge has never gotten me a job. Nor, as far as I know, have the social justice movement or the expert class ever prevented me from getting one. And while living on UBI might not be ideal, it’s surely better than starving.

There are also times where Kotkin casts his net a bit wide. For example, he argues that one of the problems faced by the West is that technology is robbing millennials of their social skills. I have to declare a conflict of interest—I am a millennial—but I don’t think the problem is necessarily as pointed or as relevant as Kotkin claims. “In this day when conversation is not so much a ‘lost’ as a ‘wilfully abandoned’ art, people in numbers cannot be left to spend an evening on nothing but conversation” wrote America’s mistress of etiquette, Emily Post in 1924 on the damage done to social skills by the bridge-table and the gramophone. “The modern fashionables in America, and in England, too, are as helpless as children at a party without something for them to do, listen to, or look at!”

Even so, there’s a lot to like in The Coming of Neo-Feudalism. Populists on the Left and Right can often argue that things are going badly because those in power are intentionally screwing the rest of us over. But Kotkin is able to highlight concerns with the growing wealth and influence of global elites without depicting them as capitalist robber-barons lighting cigars with hundred-dollar bills and laughing about the plight of the working class. Or as a shadowy cabal of postmodern neo-Marxists plotting to bring down Western civilisation with a barrage of gay wedding cakes and political correctness. Things are going badly, but not necessarily because of bad people. I think this is probably correct, and I doubt that the tech oligarchs planned to have the political, economic, and social power they ended up with when they started out. It would surprise me if Mark Zuckerberg knew he’d end up being grilled by Congress when he started Facebook in his college dorm.

Perhaps the greatest achievement of The Coming of Neo-Feudalism is its prescience—it has only become more relevant in the time since it was completed (it was published in May, so the proofs would presumably have gone to press at least a few months before that). COVID-19 has created a sharp division between those who can work from home on their laptops and those who can’t, the latter including many people already suffering from insecurity in the gig economy. Twitter’s decision to respond to the spread of misinformation about the novel coronavirus by putting fact-checking tags on tweets (including tweets by the president of the United States) demonstrates the growing influence of social media companies on public discourse.

This is not to criticise Twitter—the company is in a bind. Either it does nothing and is accused of complicity in the spread of potentially deadly COVID-19 misinformation, or it takes an active role in identifying misinformation of all types on its platform, going from a carriage service to an actual publisher in its own right. But the fact that this dilemma exists at all demonstrates its reach. And finally, of course, I am writing this in the midst of America’s worst civil unrest in half a century. Kotkin predicted that the new “peasant revolts” would be driven by economic uncertainty and anger over immigration, which are obviously not the causes of the protests convulsing the United States now. But it’s probably fair to say that, while the killing of George Floyd was the immediate spark, the protests and riots have been fuelled by a range of social and economic frustrations (you can read Kotkin’s own views on this in Quillette).

The social and economic divide which Kotkin has identified is certainly real, and very easy for those who have spent all their time on one side to overlook. I am now a pampered representative of the Clerisy, writing this review on my laptop without bothering to get out of bed. But a decade ago I spent two years during the last economic crisis living in a trailer and working as a farm labourer in the lower mainland of British Columbia, and it was a completely different world to the one I inhabit now (I have never been rich, so I can’t comment on what life is like for the Oligarchy). Kotkin’s warning in this timely, compelling, and well-written book should be heeded.

 

Adam Wakeling is an Australian lawyer, writer, and historian. You can follow him on Twitter @AdamMWakeling.

Feature image: Migrant agricultural worker’s family. Seven hungry children. Mother aged thirty-two. Father is native Californian. Nipomo, California 1936. Photographer Dorothea Lange. New York Public Library.

Comments

  1. I’m disappointed in this book, good review though. The superficial similarity between, for example, tech monopolies and aristocrats is a thin argument, at best.

    I was expecting a discussion around the role of the individual, the assumptions of progress, and potential, and instead its the same left wing claptrap you always see “herpaderp anything that isn’t social democracy and progressive liberalism is baaaaaaad”.

    Actual medieval people were quite happy with what they had, the upper classes did not lord it over the peasants but were obliged to support them with parties, food, hospitality, public works etc. Peasants, at least in the UK, had way more freedom than workers today, and had the ability to both work for the lord of the manor and as a skilled tradesman to earn money.

  2. It doesn’t look like an implausible thesis, but where are the military and security forces in all of this ?
    A cognitive elite may take on the roles of the old priests and bureaucrats to form a technocratic class of temporal and spiritual managers, the holders of capital may become the oligarchs, but those who are willing to fight and kill will always have a special place in society, they won’t be able to just draft them in from the underclass in times of emergency.

  3. Interesting review. I have not read the book but I enjoy these dystopian parades of horribles because they make me think. They seem to always, however, ignore the fact that we have cyclical elections, not only in the U.S. but in many other parts of the world. These elections, at least in the U.S., occur at the national, state, county and municipal level, and impact even seemingly mundane policy work, for example, trustee of the water district. We also have, of course, a constitutional balance of powers. Elections produce unforeseen results, as we know. They also often leave voters stark choices. It would be interesting to see this neofeudalism theory run through the typewriter once more, as Raymond Carver used to say, factoring in elections.

  4. This is why at the end of the day, even though liberalism has lost its way and lost focus on what is important, I’m still a liberal. There is a growing contingent of liberal Republicans who are horrified by the tech and other Oligarchs and their concentration of all the wealth in the hands of a very few. They hide behind the cover of Woke politics to amass ever greater control of the economy and they even manage to buy off socialists who swear and oath of fealty to their capitalist overlords.

  5. When over the course of a decade or so you pack up a very large portion of your manufacturing jobs and send them to another country, large cracks are inevitably going to appear in your economy. Don’t know whether this is causal or correlative, but the feudal structure described by this book seems, in part anyway, as a result of that economic seismic shift. At first it just seemed like a windfall for all with cheap Chinese goods flowing into the country thereby taming inflationary pressures. All in the glowing name of globalism. The flip side of course was that many of the people who had once held those manufacturing jobs were out of those good jobs and thrown into retail jobs selling the stuff they once made - at lower wages. This then degenerated into the gig economy and the purportedly feudal morass we seem headed toward now. I know this a is simplistic analysis, but something sure as hell happened.

    Can it be reversed? Just ask yourself whether you would be willing to pay more for all that stuff you buy at Walmart, Target, and most retail stores. And, as we recently learned, pharmaceuticals. (How did that happen?) If the answer is yes, then redesign our economy to accomplish that: tariff the imports, bring back the jobs and reopen the factories. Nationalize - in the best possible sense - our economy. Yes, I know that will create a whole new set of problems, but isn’t that what we have fancy business schools to resolve? If, on the other hand, the answer is no, read this guy’s book.

  6. Kotkin predicted that the new “peasant revolts”

    There are two broad classes of peasants now tho. To oversimplify, the Deplorable white, conservative, worker, and the sort of people who are rioting at the moment. These two groups have little in common but their poor prospects. Donald Trump at least pretends to represent the former and the woke clerisy and the Dems represent the latter. The plutocracy quietly vacuums up all the wealth while the plebes fight. Divide and conquer.

  7. Explain this to Jeff Bezos and his “bought off” Kshama Sawant.

  8. I was in Seattle for a trip recently, spent a few nights there and toured the city. Quite frankly I was shocked at all the new skyscrapers and the truly amazing skyline. There are several more in progress. They do have a homeless problem but that is insignificant compared to the economic power of Seattle. It’s not going anywhere and it will continue to be an economic powerhouse. Bezos can make one phone call and restore order.

  9. The key to better jobs for the working classes is votech, along with opening up the trade professions to the less academically successful. There is no earthly reason why a farrier should have to pass a written exam, or why a chef should have to know trigonometry- I thought I would never have to use the latter, until I found myself calculating roofing angles.

    A foundational liberal belief is that anyone can be educated to do anything given enough resources and time, but this is simply not the case. There is a huge range of cognitive diversity within the population and our current system of education presents a unidimensional measure for success. It is easy to see why so many kids act up, when there is an implicit statement that one can never be a success if the lottery of genetics and nurture creates a disadvantage from birth.

    I’m not saying that the cognitively gifted should be discouraged from pursing some vocations- my brother is a chef, and he has a Masters- but with the devastation of the old clerical class, many otherwise gifted young men migrated into the trades for a lack of a better option, creating undue competition for less gifted individuals who could have just as easily filled these jobs. Psychometric testing should be made far more widely available and actively promoted, as by pushing those with more potential options to maximise their human capital, if might free up jobs for those with fewer options available.

  10. I believe there are pills you can get for that :smiley:

    Tories are far more fun than liberals, and much brighter. COme and join us, you’ll be so much freer and happier.

  11. A couple of minor points or corrections: It should read that some tech companies have 300 times market value not 300 times revenue per employee compared to older companies. Also the gini comparison is better made after taxes.

  12. Very insightful comment.

    I have started reading this book. So far it fits with everything I see happening. Trump has actually made an effort to represent the people in the urban ghettos with increased investment, economic development and prison reform. But he steps on his own accomplishments with his stupid tweets.

    The clerisy has total control of this group and although the auto de fe’s over George Floyd’s killing will have no long term benefit for the urban poor, they will likely cement the clerisy’s control of the executive branch come November.

    We free market Republicans never saw this coming and we should have. If we want to preserve democracy, who have to exert some sort of government control over the tech oligarchs who now run the country to a large extent.

  13. Why would he do that? Bezos and the other tech oligarchs isolate themselves from woke criticism by giving indulgences to SJW causes. He is not going to jeopardize that.

  14. Yep. Instead, he would rather force me to see the white fragility book and other “antiracist” books on my Kindle screensaver.

  15. Wow! That one keeps coming on my Kindle as well as well as other left wing books despite the fact that I lean towards conservative book purchases. Think that is a coincidence?

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