Democracies are being unraveled with by a new class war. [inaudible conversations] good evening and welcome to Hudson Institute, stern policy center. Im john wallace, chief operating officer. Id like to welcome our audience here at our pennsylvania avenue headquarters and our cspan audience the our first ever podcast taping that is both live and marks the Second Season of the premiere podcast of the Second Season realignment hosted by our Hudson Institute fellows. The podcast launched last year, and i recommend end for those of you who havent been following it, that you take a look at the episodes from last year, particularly the conversation with secretary of state mike pompeo, josh haully, mike duran and others. Its an Excellent Program partly because of the two people who put it together and their ability to bring out topics and to move the argument along. So we couldnt be prouder of the work that theyve done and want to thank them for that, and we are happy to launch this Years Program with michael lind who is, as many of you know, a prolific writer of more than a dozen books, cofounder of the new America Foundation with Walter Russell mead. Michael is a professor if at lyndon b. Johnson school of Public Affairs at the university of texas. And important for tonights conversation, he is the author of the new class war saving democracy from the managerial elite. The book was just published today, so were here at the launch. Congratulations, michael, on the new book. Theres a direct line between the new class war and the work that michael has done and has been pursuing since the 90, maybe most exemplifieded by his book the fourth american revolution. Sorry, the next american nation nationalism in the fourth american revolution. Whether you agree with his interpretation of western politics sense world war ii, his work demonstrates a serious effort to understand the causes of and the solutions to seemingly are never ending cycle of clashes and shifting to coalitions, which is exactly what our realignment podcast seeks to explore. Also joining us is j. D. Vance, who fittingly was the realignments premier guest. J. D. , of course, is the author of the best sell ising and highly innine usual book hillbilly elegy. He recently cofound narnia capital, a Venture Capital firm investing in people and technologies working to solve significant challenges. Also a visiting fellow at aei. I have not, ive only started his book. Ive, of course, read j. D. Vances book which if you havent, you should. Its an important discussion of a part of america that maybe someone like Charles Murray would say is outside the bubble of the elite classes. At the beginning of michaels new book, he says dem gynecologygy populism demagoguery populism is the symptom, democratic pluralism is the cure. Im not sure if that is a throwdown for this evening with a room full of people in washington, d. C. , but we are pleased to start from that discussion and to take on that issue with his help. We will take questions later in the program, and you can email those to events hudson. Org, and well get them up to the, to marshall to use as we get to that part of the program. So please send them along. Everyone in here is, i know, technically sophisticated, so this will not be a problem. And without any further ado, let me, please join me in welcoming michael lind and j. D. Vance. [applause] one quick note, michaels going to be available after the talk to sign books, so if you found this great [inaudible] just to reiterate, if you have any questions, event hudson. Org, so at that point ill speak for you. With that, marshall, why dont you start us off. The book is called the new class war. First question, lets define terms. What is a class war . Well, a class war is a conflict among quasihereditary classes where your parent range is associated with a particular structure of occupations. We think we live in a meritocratic system, but if you look at what i argue is the fundamental cleavage in modern transatlantic societies which is educational, its not a matter of mere aftertax income, youre much more likely to get a diploma if one or both of your participants had diplomas parents, which are kind of the new degrees of nobility. So i argue that in europe as well as in the United States, i think both sides of the atlantic are similar enough now to make robust generalizations. That wouldnt have been the case 40 or 50 years ago. But as europe has become more multiethnic, as the United States has become more secular, i think theres some convergence. And what you see is, arguably, this widening divide socially and politically between the collegeeducated and the more or less twothirds which does not are have even a bachelors degree. J. D. , do you agree with that take . Because so interpret what youre saying, it seems like what youre saying is unlike in previous err maas, class status matters more than income. Well, yes and no. The average american who has a bachelors degree has an income of about 60,000 a year. The average High School Graduate with no Higher Education is about 37,000. So theres a correlation. But unlike in the past with class status was based on ownership of property whether you were a feudal landlord and you to owned land or you were an ebeneezer scrooge Small Business owner and the owneroperator of a business, the elites in the western world today, large wily their wealth, their power and their status tends to come from their position in a large bureaucratic organization. It can be a corporation, it can be a law firm, it can be a nonprofit, it can be the military. And access to those lucrative, influential positions is largely determined by education. What do you think, j. D. . Because i think one of the common retorts to that is, with well, its not why is it education is the great denoter of classes . Michael and i were speaking this morning, he said a plumber could be making 100,000 and be rich, still working class. Based on your own experience, how do you see that cleavage in American Society . Yeah. So i largely agree with mike. And, first of all, thank you for doing this. Next time you have me on a podcast, please tell me what color the couch is though. [laughter] i think whats true about mikes account i dont know that the i 100 agree with it, i9 5 i 95 agree with it. Whats true about that account is if you go to a suburb in cincinnati, ohio, and you go to a Plumbing Firm and you go to the guy who owns the firm, the people who work this and then the clear can call staff clerical staff, theres something much more similar about that group of people, about their spouses, about their children than there is, you know, between lets say the owner of the Plumbing Supply firm and a person whos a majority or large shareholder at google, for example. So i do think that theres something about the way in which Educational Status both confers but also sort of reinforces and signifies class status thats really important in our society. And, of course, you know, most people do not, the gross majority of people cannot earn their living off capital appreciation. So there is this weird way in which what mike calls the professional managerial class is coherent even though it might not have the, you know, the sort of person at the 91 per seven tile at the percentile of the income. So, mike, to tie a bow on, this on the managerial class, its like a slur, who are these people in particular . Large bureaucratic organization, corporate elite, government, or is it just in the transatlantic sense what is it that defines them as a class . Well, there are different definitions. The left has something it calls the p and c, the positional pmc, the professional man year class. And these tend to be people in the professions where you more or less set your with own hours; lawyers, doctors more in the past than present, professors, podcast hosts [laughter] and you can work from home, basically. So this kind of progressive theory is there are three classes. This is the working class, theres the professional managerial class, the podcasters and professors, and then theres the capitalists, right . Up there and i reject this. I follow james burnham, the trotzky of the early conservative movement of the 1940s who wrote the book with the managerial revolution. He argued that the independent owneroperator who was the capitalist but also ran his own business had been superseded already by the 1920s in the u. S. And europe by corporate managers. But he also included in the managerial class government officials, career civil servants, academics. And in a passage in 1940, he said the career military. Of the uniformed military which would become more and more important over time as one of the most organized. So long before the deep state, right . At which he was kind of part of, because he worked for the cia a lot in the ensuing decade. So i have a broader definition of it than a lot of people do. But again, its, i think if you contrast it with the working class, the working class is changing its nature because of the changing composition of jobs. Participant of it through parts of it through manufacturing, outsourcing but also through ordinary productivity growth. Manufacturing has she would a lot of jobs shed a lot of jobs. Almost all of the new jobs are created in three sectors. Its leisure and hospitality, retail and health care. And according to the u. S. Government, of the top ten jobs that are being created in numerical terms, only registered nurse requires any education beyond a High School Diploma. So the story that we are told at davos and aspen and not here, of course [inaudible] obviously. Yeah. The jobs of the future require advanced education and all that. Actually, they dont. Americans and their the counterparts, working class counterparts in europe are underpaid. They are not overeducated. And my argument in the new class are war is they are underpaid because they lack Bargaining Power of the kind that they possessed 20, 30, 40, 50 years ago. So before we move on, i think the thing that i havent quite understood yet from the conversation is the war part, right . We can buy that theres an educational system that preferences people with drees, Certain Industries are wheres the war . A war suggests theres a group of people thats elite that is not only looking down upon the working class, but actively trying to harm them to benefit themselves. And im curious what your taken on that is too, j. D. The book is not a Conspiracy Theory, not the protocols of the elders of zion. And i dont think theres, like, some secret, you know, office in washington or new york or San Francisco where the committee of the ruling class gets together. Its just that when power is unevenly distributed among social groups and individuals pursue their own interests, the result even though it is not, theres no coordination is going to look as though the class is doing it when, in fact, its just the result of lots of individual actions. If you look at Public Policy from the 1990 to the present, globalization, one of the things that just amazes me as a student of politics all my life is the unwillingness of people to acknowledge that there are tradeoffs with trade, with immigration, with investment that different groups of society some benefit, some lose. Theres this constant din of propaganda, free benefits for everybody. Large skill, low skill immigration benefits everyone. And you just think, well, this is totally unrealistic. There are winners, there are the losers. So thats part of the war. Of the policy that benefits the winners is the one that is the only one defended in public and the only one you hear. And it becomes taboo to discuss the views of the losers. Thats a kind of war. Yeah, and i want to, quick on that, the way that i think about, this marshall, one of the institutions that the working class has depended on in the recent past actually insure they have equally Bargaining Power, at least some measure of Bargaining Power. So, you know, classic story, labor union, right . Private sector labor union participation in the late 50 i believe was 33 , its now 6 , basically decimated. Its not sort of a right to work story, though im not a fan, it is a primarily localization story. The church, right, chat are you can institution that classic institution, the social fabric and also insures participants have some meaningful participation in the direction of the culture, the direction of the policies that influence that culture. Working class work participation has fallen off. And the big one is families. The place in which working class children grow up hopefully in stable, happy, healthy homes, we know marriage has become a luxury, the solution has dropped pretty substantially m professional class family formation and stability has a slight decline where it was in the 1950s or 60s so all of these institutions that are sort of necessary in insuring working class people both live happy lives but also have a meaningful stake in the class they live in have become substantially weakened in the past few years. So if theres been a class war in the past 50 or 60 years, its pretty clear whos losing. Right x. So from that perspective i mean, i agree with all of this, and the critics specifically of your book, michael, have come out and say you are apologizing and conflating economic anxiety which they say is a rightwing talking point for actual racial resentment. But you counter that in a recent piece you wrote in the wall street journal citing an mit study, counties that were hit hardest were most likely to support donald trump and Bernie Sanders. So if that were the case, why would they be supporting somebody like Bernie Sanders . J. D. , of course, i want to get you in on that after to talk specifically about the economic anxiety piece being really den monoized as just a demonized as racism. There are three narratives about this populist uprising that has produced trump in the u. S. One is its just this spontaneous eruption of neonazi racism which maybe was manipulated by Vladimir Putin from the kremlin, and he just triggered this wave of, you know, boys from brazil white nationalists about to overthrow democracy in the and the u. K. And france and so on. You can tell what i think of that. [laughter] thats a partisan alibi for the loss of Hillary Clinton andmy corbin. Its not and jeremy corbyn. Most serious, its the story about money. Its about rising inequality. And progressives in particular, they like to have this graph of the great compression, and it goes down from the 1920s, and then it goes up again. And if its just about money, then you have aftertax redistribution, and you just give these working class people checks, and theyll be happy. And the story i tell in the new class war is its about power. Power is independent of money. That is, power the ability to influence your life, to influence your society, and power exists outside of the narrow governmental realm. Is and libertarians get upset with me for this point, but there is economic power in the marketplace. You do not have equality of Bargaining Power between most employers and most employees. There is cultural power in the media. If you dont like the offered use for your children that you find on tv or in the movies, whatever, you cant just go found your own movie studio or found your own social media platform. Thats power. And particularly for americans, the basis of the american creed was in the 18th century what they called republican liberty. The idea that you could not trust concentrated power of any kind, economic they didnt have media back then, but, or political power. And diffusing power and having checks and balances is good in and of itself. And i think weve kind of lost this with this narrative about its all about money. And if we centralize and hoard power but we give you a 500 tax crept or a credit or a 2,000 tax credit every year, then you should be happy. Right. Yeah, please, j. D. Well, i was just going to say im not a fan of what i would call the crack materialistic view of economic ang sity led to trump. I think its much more complicated and difficult than that. Not having a decent job or not having enough money to afford the things you need, thats part of it. But also its looking outside your door and seeing a community that thriving 20 or 30 years ago, and now every single store downtown is closed up. Or finding out yet again that one of your friends, one of your kids friends has die of the opioid end epidemic. Its still very much this feeling of losing power over your own life. I make this point a fair amount, but i think its important so ill make it here again. You have to understand what the purpose is of the narrative the trump voters were motivated by pure racism or pure racial anxiety. If theyre just racists, if theyre just bad people, then you dont have to care about their concerns or worries. We know two thing very substantially about the trump vote. One is that it was really related to the decline of manufacturing jobs primarily caused by the china shock. We also know that it was heavily related and tied to the rise in what, you know, folks have called depths of despair. That when you see a rise in opioidrelated deaths in a community, you also see a significant shift from romney to trump in 2016. Well, if youre focus on the fact that all these people are racist and youre not concerned about the fact that a member of the elite that michael lind is so concerned about actually calls an open yield e epidemic opioid epidemic, Purdue Pharmaceuticals flooded these communities with drugs, and if were not talking about that, then were just participating in a war that elites, i think, have been winning for the past two decades. How do we balance the racial and cultural issue . The thing that the critics, the critics point out true fact which is the country is is changing. The countrys white majority is shrinking,