It’s all very fun to predict that America is going to slide toward some modern form of feudalism. It’s even more amusing to insist that it’s already happened.
It’s also bunkum.
Contemporary society may have little place for orthodox religion, and our military, however impressive, hardly constitutes an effective ruling class. But we are beginning to see the elevation of two very powerful classes—one dominant economically, the other culturally. Meanwhile, the power of today’s Third Estate inexorably weakens.
The ultrarich represent an emergent global aristocracy—or rather, a new oligarchy. Fewer than one hundred billionaires now own as much as 50 percent of the world’s assets—the same amount that around four hundred billionaires owned a little more than five years ago. In the United States, the richest four hundred U.S. citizens now have more wealth than 185 million of their fellow Americans combined. The shift has been dramatic: the top 1 percent in America captured just 4.9 percent of total U.S. income growth from 1945 to 1973, but in the following two decades the country’s richest classes gobbled up the majority of U.S. income growth.
It’s simply nonsense in two different ways but for the same reason. We don’t count wealth properly.
The first problem is that we count wealth before everything we do to redistribute wealth. We’re counting what people have as a known and seen financial asset that is transferable. And yet we’ve already decided that we don’t like that pure market distribution of wealth. So, we’ve gone and changed it. But, when we measure wealth inequality we don’t incorporate the movement of wealth as the result of our attempts to change that distribution.
For example, a fully funded private sector pension is wealth. The state pension is not wealth. A pile of cash you can use to buy health care is wealth, the NHS is not wealth. Free schooling for the kiddies is not wealth – although it quite obviously is.
So, modern measurements of wealth are nowt but tosh. They’re simply not telling us anything useful about the actual distribution of wealth.
The second bit is that this financial wealth that is being analysed, it’s not even the largest part of wealth anyway. That’s human capital. And we don’t measure that value nor its distribution. Despite our knowing that it’s several times the size of financial wealth and also markedly more equally distributed.
All of which means that a claim that we’re entering a new feudalism based upon our studies of the wealth distribution is, well, it’s tosh, isn’t it?