Not everything is a class dynamic. “Analyst at GS hanging out in the Hamptons” doesn’t scream working class.
The CEO and analyst are both upper class, just different levels of power and seniority.
That CEO is just a power-tripping asshole.
The CEO and analyst are both upper class, just different levels of power and seniority.
That CEO is just a power-tripping asshole.
The reason they're used more is because there is a very clear distinction between groups even at high levels of wealth due to the need to socially signal. This is what causes CEOs to flip out that an analyst is trying to casually talk to them at a non-work event as if they are equals.
This is class dynamics in action, it's not all about the working class vs upper class, but how these different classes interact internally and externally.
Upper vs working the most important divide (IMHO), but not the only one.
But feeling like you have better opinions or thought deeper about subjects than others or that you know "how it really is", or that you're a better driver or whatever are other common ways. Whatever you feel like you are good at, or have a lot of, you will be tempted to feel superior about.
Fighting these thoughts is virtuous in my opinion. Pretending that only X type of people do it (rich or whatever) is not virtuous in my opinion.
It’s that weird in-between, where one still needs to earn a living and make even more money for someone else.
A 25M / year CEO is far past "earning a living" and really only works because they want to.
Upwards mobility my ass.
Social class is not just about your current salary, although 200k soon after graduation isn't exactly 'average'...
Some might even say that walking up to the CEO like that indicates upper class self-assurance...
In the office setting the CEO would never been seen anywhere near the same floor that such junior people are working or eating, never having the opportunity to introduce themselves. One bank famously had a special CEO elevator so the guy could seamlessly get from the garage to his high-rise executive suite without bumping into a single soul.
I recently found myself out to dinner a table over from a C-suite exec at my company. I did not introduce myself because I'm a socially damaged introvert.
It's a pretty easy bet that the kid was a major extrovert on the other hand, more than some assumption they must already be upper class.
You'd be surprised about the class mobility on Wall St vs other industries. When I graduated, Google famously did not even recruit from anything other than a small handful of schools and screened out a pretty high GPA minimum like 3.75 or so. Meanwhile every bank came to my college and I had like 5 offers. A good number of my coworkers spent some time at community college, had parents without college degrees, are first gen immigrants, etc.
Outside of glad-handing networking roles that lean on peoples connections like in IB, "already rich" is the exception rather than the rule. Bear was famous for saying they didn't hire MBAs, but instead PSDs — poor, smart and had a deep desire to be rich
The meritocrats are the ones that work the jobs where they actually have to make money and profits. Nepos are shunted to roles where that isn’t as direct.
or to use an older one: petit bourgeoisie
Class is defined by one's relationship to the means of production (e.g. whether you work in a factory, or own the factory where people work)
In the modern economy, capital owners are reliant on a class of non-fungible white collar workers that bring their own human capital. The two groups have myriad common interests. Those interests are in many cases in opposition to those of ordinary workers who lack human capital and are fungible and easily replaced.
They’re proles by the definition of how they earn their labor. If the pool of labor expands beyond the available roles, those high salaries would crash down.
Were we to push that to the extreme, the only upper-class at Goldman Sachs would be retirees, either as direct shareholders or as beneficiaries of some pension fund. Even if they were lower middle-class Americans living in an old aging house they can’t afford to fix.
That would be the Value Extraction definition of Class.
Others would argue that class is more diffuse, and that one’s class depends more on their family's history, where they went to school, and who they know, than on how much they have. Which is a valid point.
That would be a Social Capital definition of Class.
I doubt however that anyone would consider a street-sweeping former Emperor (eg Piyin), or some penniless heir to some old industry dynasty as still belonging to any sort of upper-class.
Meaning the actual definition actually is some fluid mix of the two. That and probably some other definitions I’m not even aware of.
> In the modern economy, capital owners are reliant on a class of non-fungible white collar workers that bring their own human capital.
It’s nothing modern. Capital owners always have, since the first scribe, and probably before that (see Japan’s former hordes of perpetually desk-bound samurai).
Still, let’s entertain the argument. I’ll use, and I’m truly sorry for that, a tired analogy.
In the modern world, many people are reliant on many different types of usually non-fungible pets and somewhat fungible, depending on who you ask, animals, for many different purposes. Some of which bring their own highly sought-after hard-earned skills.
Let’s limit ourselves to the oh so tired dog analogy.
A person and their dog have myriad common interests. Those interests are, in many cases, in opposition to those of many other people and animals. Even more so when said dog is considered a family member, serves as a guard dog, as a shepherd dog, or is specialised in drugs detection.
Does that make them equal? Does that change anything to the fact that one is extracting value from the other, and often only pays them back in dog food, usually made from our food industry’s literal scraps and refuse?
So yes, I agree with you: there’s no simple and definitely no simplistic definition of class.
I am still convinced however that, in the specific and limited context of the comment I was replying to, the one I used was good enough.
By your value-extraction definition, Sundar Pichai isn’t upper class. He doesn’t make money from his ownership of the capital—he owns a negligible share of Alphabet. Instead, he helps the shareholders extract more value from Alphabet and is compensated for that work. A definition that excludes CEOs from the upper class isn’t a very workable one.
I think a more useful definition recognizes that, in between shareholders and the workers is a class of people who help the shareholders extract more value from the enterprise, and therefore has interests closely aligned with those of the shareholders. For example in a company like Uber, that’s what the programmers are doing. They’re not creating value, they’re building systems to extract more value from the drivers.
Another way to look at it is that there’s a large class of people whose jobs wouldn’t be nearly as well compensated without monopolistic capitalism. $500,000/year Facebook engineers only exist because Facebook as an enterprise throws off enormous amounts of cash. If you look at more social-democratic societies, the biggest difference isn’t at the very top. Sweden and Norway have more billionaires per capita than the United States. Instead, the biggest difference is in the professional class. Swedish engineers (and bankers and lawyers and other professionals) make a fraction of what their American counterparts make. And that’s because Sweden has far fewer of these insanely high margin businesses.
And yet they are both animals, often get treated as less than most people, the shepherd dog only gets the proverbial scraps. Precisely the analogy’s entire point. I’m Glad I didn’t have to spell it out.
> A definition that excludes CEOs from the upper class isn’t a very workable one.
Absolutely. Hence the "Were we to push that to the extreme", followed by a ridiculous application of the definition.
> Another way to look at it is that there’s a large class of people whose jobs wouldn’t be nearly as well compensated without monopolistic capitalism.
And thus we can differentiate those of these people who are part of the upper class from those who aren’t by wether they get an actual share of the value they produce, or merely scraps. Wether they are compensated as equals, or as useful tools.
Interesting bit about Sweden and Norway. I didn’t know that.
Yes, but focusing on those factors gives you an incomplete understanding of the dog’s place on the farm. At the end of the, day the dog is helping the farmer extract value from the sheep. Indeed, the dog’s very specialized skills wouldn’t have much value outside the context of the farming enterprise. That means the dog’s interests are much more aligned with the farmer’s than the sheep. His unique role, and relatively comfortable position, wouldn’t exist outside the value-extractive context of the farm.
> And thus we can differentiate those of these people who are part of the upper class from those who aren’t by wether they get an actual share of the value they produce, or merely scraps. Wether they are compensated as equals, or as useful tools
Facebook engineers building the infrastructure the company uses to extract monopolistic profits from consumers are receiving a share of the value. The actual value creation ultimately comes from someone making shoes in a factory in China, which sells them to Nike, which uses Facebook advertising and branding to sell them to consumers for far more than they’re worth. Yes, he’s a “useful tool” for the shareholders, but so are the senior executives (besides Zuck). Their ability to command $500,000 salaries or $1 million salaries, or $10 million salaries doesn’t exist outside the context of these enormous monopolistic profits.
You’re getting hung up on “equality” but being in the same class doesn’t mean you’re equal. In a feudal society, knights may be quite lowly compared to a high ranking landowner. They’re “useful tools.” But I’m not talking about equality of rank, I’m talking about interests and incentives. On that front, the knights have fundamentally different interests and incentives than the serfs. Whatever resentment they might have toward higher ranking nobility, they still reap the benefits of the feudal structure. The my would be much worse off outside that structure.
Which, to me, reflects a huge gap in power and freedom.
One decides what the other does. One can decide how much the other will earn. One can decide wether or not the other will still have a job tomorrow. The other needs a job if they want to have a roof over their head and food on the table in six months.
Which is why I still don’t find your definition satisfactory. Sure alignment of interests matters, but to me it’s not enough.
It’s been an insightful discussion, and I’ve truly enjoyed it, but I’m afraid we won’t be able to reach a conclusion we can both agree on.
The big push into consumer finance has been a complete multi-billion loss making debacle under his leadership.
Class can be more fine-grained than just lower/working-middle-upper
People commonly talk about “upper middle class” vs “lower middle class”, and then I suppose there are even some people in between the two (middle middle class?)
Well, in the same way there is surely lower upper class and upper upper class, and maybe even more levels than that. A person on an annual salary of US$25 million is undeniably upper class but still far beneath the centibillionaire class.
There’s also no clear boundary between upper middle and lower upper. You may think someone on US$250K is “upper class” but they probably only think of themselves as “upper middle class”, and personally I would think the same. In my own head, to really be upper class, your annual income has to be (consistently) measured in millions, not hundreds of thousands.
Who is more upper class, a relatively impoverished Prince of the Holy Roman Empire or a billionaire by marriage and luck? Managers like the mentioned bank CEO, or someone who can rent them a house in the Hamptons because they have lived there for generations? An intellectual who has never really worked, or a wealthy rapper who didn't finish high school?
I think Western society has been undergoing a transition between two different class systems. (Marxists would surely connect this with the economic transitions from feudalism to mercantilism to early capitalism to late capitalism.)
In the mediaeval class system, class was determined by social status which was predominantly inherited, and money alone was not enough to move from the bottom to the top. A person born poor might acquire great wealth, but they would still be locked out of the nobility/aristocracy, unless the monarch deigned to ennoble them. An impoverished baron socially outranked the far wealthier merchant who was born into poverty and worked/lucked their way out of it.
In the late capitalist class system–all that really matters is your net worth. Everything else is secondary. Who cares who your parents were or where you come from once you have a billion dollars to your name – and if a billionaire is excluded socially, it is very likely due to something about their individual behaviour (see e.g Kanye–although I suppose he's an ex-billionaire now), rather than their family background in itself.
The transition between the two systems has been ongoing; it still hasn't completely finished, but we've moved a lot closer to the late capitalist system, and a lot further away from the mediaeval system, than we were 50 or 100 years ago. I don't think the transition proceeds at the same rate in every country either – I think the UK retains more of the old class system than most other places (although even in the UK it is a lot weaker than it used to be); it also arguably retains some strength in the northeastern US, although not to the same extent as the UK.
My point is that different people look up (or down) to different people by different criteria: "net worth" interests competitive capitalist adventurers, "who your parents were or where you come from" remains a high priority when someone is wealthy enough for their lifestyle.
I certainly find it plausible that if A and B are of roughly similar wealth, but A was born into wealth whereas B lucked/worked/married into it, A might see that as a reason to look down on B.
However, I suspect if A was born into $100 million and B lucked/worked/etc into $100 billion, then all else being equal, I doubt A would look down on B in the same way. I expect they'd more likely view B with envy, as a potential business opportunity for themselves, as a friendship which might give them access to things they themselves can't afford, than as a social inferior. When the gap in wealth becomes big enough, it tends to drown out all the other factors.
The huge class divides are not between retail workers, tradesmen and software developers, the divide is between C-suite executives / old money, and... everyone else who has to work for a living.
As a tech worker, I have far more in common lifestyle-wise with a schoolteacher than I do with the SVP of Engineering in my own company.
In the US, working class tends to mean people in food service, retail sales, low-skill manual labor, people relying on gig work, and some very low-level white-collar workers like secretaries. Upper class are basically the very few people for whom work is optional. F500 CEOs, SVPs, billionaire investors, and so on. Their existing wealth grows at a rate that can sustain their and their family's standard of living indefinitely.
The rest is middle class, a very wide range from schoolteachers, to skilled tradesmen, to engineers, to university professors, to small business owners, to doctors and so on.
My point is that people are nit-picking when they say things like "Oh, but doctors are upper middle class and teachers are lower middle class and engineers are lower upper middle class and on and on and on. Distinction without a meaningful difference.
I think traditional concepts of social class count for a lot less in the UK of 2023 than they did in the UK of 1973. But wealth counts for just as much, even more.
Were Rishi Sunak's parents "upper class"? And yet, he'd surely be a far more valuable social connection to have than Baron Forgettable who happens to be the King's fifth cousin. And I think that will remain true even when his prime ministership is over.
The queen bee who owns a share of the hive, decides how many bees to hire/fire, where they work, when they work, what % of the honey to share with the worker bees, etc.. now thats a different class.
Team managers/trainers do not meet most of those criteria. At most the GM meets the majority of them. Only the team owner would meet all the criteria.
Amazon was once a small business. It's possible to grow that hive but the vast majority get exterminated.
It’s rare that those businesses scale to the point of where your role is purely abstract management layers removed from the front line workforce.
These two classes have largely contradictory interests. People who own companies want to cut their costs, and therefore they want to lower wages, give lower benefits, less time off, and so on. Workers want the exact opposite of that.
People such as CEOs constitute a labour aristocracy where their interests largely align with the interests of large capitalists and they own some capital of their own.
If capital gains hand someone 300k a year, they aren't quite workers, but they aren't playing the same game as someone who is still playing the accumulation game. It's the best trick the late 20th century played: Defined contribution workers are all also capitalists, just like everyone relying on an ever more valuable house.
An actual capitalist makes a living by using their capital as the primary vehicle to create further wealth for themselves and to sustain their lifestyle.
Again, the key distinction is in terms of class interests. What sort of social policies would be of interest to each type of individual is the question.
If the analyst lives in NYC and makes $250k they aren't living large. If they went to an Ivy League school and have to pay for it they really aren't living large. Regardless, the story makes the CEO look silly.
It is in part. A person on a US$20 million a year salary obviously isn’t working class or even middle class-they might truthfully say they are of “working/middle class background” (if their parents were of more modest means)
Whereas, their 10 year old kid whose annual income and assets are roughly $0 is also upper class-because their parents are. Now, if they grow up and their parents end up disowning them and they end up living on the streets homeless-then they won’t be upper class any more. But if that doesn’t happen, then they are-because even if they aren’t filthy rich yet, very likely they’ll eventually inherit a huge amount of money from their parents (assuming they don’t already have some kind of “you’ll never have to work a day in your life” trust fund set up for them). They could live their whole life in the upper class without ever getting a salary at all
They may never work a day because they don’t need to - they are upper or “bourg.” for sure.