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The Myth of a Middle Class

Mises Daily: Tuesday, January 25, 2011 by

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Almost a year ago, during the State of the Union address, President Obama came up with another plan to ease the economic burden on middle-class families. No news here. In fact, he gave that same do-or-die case for big government we have heard over and over: "The middle class has been under assault for a long time. … We've just come through what was one of the most difficult decades the middle class has ever faced."

What always intrigues me is that we seem to take for granted, without too much scrutiny, the things government officials tell us, especially those in highest office. This speech is no exception. How many of us have really questioned the validity of expressions like "middle class"? Is there really a middle class? What's behind this terminology so beloved by our leaders? I shall try to answer the last question first.

There are two known and tested theoretical designs that can shape a political community: contractualism and market liberalism. They vary greatly in how they envisage political power and the way it should be organized. But they both agree that the individual stands as the cornerstone of every political arrangement, and he alone is the repository of the rights and obligations that define a societal existence.

This was the dominant belief until the rise of theoretical socialism and the beginning of modern statist rhetoric. Marx and his followers can only reason in terms of groups of people. They believe that history is commanded by the interests and ambitions of social classes and not by individual wills.

On the other hand, classical liberals reckon social order to be the outcome of individual action, and society to be the result of individual acts coming together. Society evolves because individual purposes, interests, and passions change every so often. To think of this evolution as something taking place only among socials classes destroys the balance and gives way to silly ideas like the ones backing the current US administration.

The people who propagate
the "class" myth are those
who will profit by it.

It is with utmost confidence that President Barack Obama believes that with the stroke of a pen he can change for the better the economic wellbeing of tens of millions of Americans: "We're fighting to build an economy in which middle-class families can afford to send their kids to college, buy a home, save for retirement, and achieve some measure of economic security when their working days are done."

Social class is a contradiction in terms. Socialists must explain why individuals, before merging into social classes, as is alleged to happen, have different interests than the future collective ones. But socialists never managed to overcome this theoretical hurdle. All they did was to further stress that individual interests exist and that they are corruptive.

In contrast, classical liberals believe that society evolves when individual interests change. They don't need to know what particular interests exist at any given time. It is the result that counts, and things always work out when society remains free and human action unplanned. You can't have social classes because people are just plain unpredictable and evolution remains an individual affair. Any reference to social classes, including the much-hailed middle class, is just a political scam.

When socialists realized that their theoretical concepts go nowhere, they switched to a more hands-on approach — moving from a revolutionary and anarchic perspective to a theory of acquiring power and establishing absolute control in their effort to curb individual freedom. The successors of 19th-century socialism, totalitarianism, and welfare-state interventionism continued to pose as defenders of the oppressed social groups whose interest they vowed to protect. But classical liberals saw that when socialists and communists took power they set in motion a mechanism of dictatorial rule based solely on one man's decision and not on collective agreements.

The concept of "middle class" implies that there are collective interests resting in the middle ground of a social hierarchy that never change and have to be preserved by a political authority. We know all too well that people change, but not all, nor a great bunch of them, at the same time.

Mises Academy: Robert Murphy teaches Principles of Economics

For most people, I believe, there are dramatic shifts in lifestyle as they age, become more experienced, and learn how to succeed. There is not a finite amount of wealth that we each get a share of, forever to have only that share. Rather, lifestyle and material wealth are quite elastic and dynamic.

To ask for the economic strengthening of a fictive middle class means to clamp down on innovation, opening the door to arbitrariness. It is precisely this kind of made-up objective that justifies needless state intervention and limits on personal freedom. The people who propagate the "class" myth are those who will profit by it. Making people believe they are in a static class, a caste from which there is no escape, simply allows politicians to more easily sell the idea of redistribution in its many forms.