Tuesday 7 May 2013

Why We All Need The Middle Class

Which, like a large and thriving private sector, and like a large and thriving working class, depends on central and local government action. That confers public responsibilities. Including public accountability for how those responsibilities are, or are not, being met.

David Boyle writes:

I bought a flat for the first time when I was 28 in the then rather neglected south London suburb of Crystal Palace, half a century after the original palace burned down – and it hadn't changed much since the fire. I'm now 54. It cost £45,000 and it was the absolute limit of what I could afford on a voluntary sector salary. I remember my despair watching rainwater pour down onto the staircase when I had no idea how I could afford to put it right.

It seems extraordinary, not to say terrifying, that my home – round the corner, still three bedrooms but now with a garden – is now worth more than 10 times that. My earnings have also risen, but arithmetically not exponentially. If I had bought only 10 years ago, I would now be working full time, in indentured servitude, to earn mortgage repayments of £700 or month or more – in a soul-destroying job in the financial sector.

As for my children, I can't see how they will ever own or rent a house in London (and house price inflation also pushes up rents). Nor is it just London: if average UK house prices rise in the next three decades as they did like the last, the average house will be worth £1.2m, and my children will have to be on salaries of £300,000 to afford their own vast mortgage shackles.

But it isn't just homes. Those institutions that provided some space in my parents' and grandparents' lives – final-salary pensions, effective banks, good human-scale secondary schools, middle management jobs – have all but gone. Pensions particularly: the average UK pension pot in the UK is now £25,000, which will pay out £1,250 a year. Pension schemes that guaranteed two-thirds of final salary on retirement, as they did a generation ago, have almost disappeared. Public service professionals have had their status and pride surgically extracted by a generation of targets, now being turbo-charged as payment by results contracts.

It isn't surprising that middle-class parents are in panic mode. They know, even if they don't articulate it, that they are no longer pushing to get their children into a burgeoning middle class – they are struggling to insert them into a shrinking global elite. The middle classes, as we have known them – and despite all the political rhetoric expended on their behalf – are on the way out.

The first question is who the middle classes are these days. And here it all gets confusing, because some surveys reckon them at somewhere over 40% of the population, some at over 70%. There are certainly a vast number of new and barely categorisable semi-middle-class tribes. I'm inclined to think that if anything holds them together, it is a determination to cling on to some sense of independence from tyrannical landlords or bosses. But there are many people, definitely not middle class, who are the same.

The second question is whether it matters that the possibility of this way of life is beginning to disappear. I think it does. For one thing, it is important that the middle classes realise that the destruction wreaked on the working classes is now in store for them. There is no economic purpose to their existence, and their jobs are being replaced by software as fast as it can be invented. For another, they provide political and economic stability, and always have done. Their fierce determination to retain some of that independence is a vital underpinning for the liberties of everyone else. Without the middle classes, there is no hope for the poor either.

But the real reason why everyone needs the middle classes – and why this isn't just about whether my own children get a roof over their heads – is that, without them, society will be bitterly divided between a tiny, wealthy elite and great sprawling proletariat, struggling for a living, measured and tested by "efficient" software in everything they do at work, holding down three jobs to survive.

The alternative to a thriving middle class is a new tyranny by the few who own everything, dedicated to a deadening efficiency that leaves no room for culture, leisure or any kind of education beyond what the elite need to man their computers. That is where we are heading, and it is partly the fault of the middle classes – "so clever in money, so stupid in politics", as George Bernard Shaw put it – who believed the middle-class rhetoric of successive governments (as they clearly believed it themselves).

After generations of class war, the interests of middle and working classes are now aligned. What they have to do, together or separately, is to claw back a new economic role with their entrepreneurial energy – and develop a new politics that will protect them from the power of the new financial elite.

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