SEISMIC SHIFT

02.15.16 5:01 AM ET

We Now Join the U.S. Class War Already in Progress

Neither Trump nor Sanders started the nation’s current class war—the biggest fight over class since the New Deal—but both candidates, as different as they are, have benefited.

Class is back. Arguably, for the first time since the New Deal, class is the dominant political issue. Virtually every candidate has tried appealing to class concerns, particularly those in the stressed middle- and lower-income groups. But the clear beneficiaries have been Trump on the right and Sanders on the left.

Class has risen to prominence as the prospects for middle- and working-class Americans have declined. Even amidst a recovery, most Americans remain pessimistic about their future prospects, and, even more seriously, doubt a bright future (PDF) for the next generation. Most show little confidence in the federal government, although many look for succor from that very source.

To understand class in America today, one has to look beyond such memes as “the one percent” or even the concept of “working families.” As Marx understood in the 19th century, classes are often fragmented, with even the rich and powerful divided by their economic interest and world view. In our complex 21st-century politics, there’s a big divergence among everyone from the oligarchic classes to those who inhabit, or fear they will soon inhabit, the economic basement.

The Fragmented OligarchiesThe Techies versus the Tangibles

This confounding election stems, as much as anything, from the growing divisions among America’s business elite. These divisions have existed in some form in the past, but may never have been so gaping as today.

On one side, we have the tangible industries—manufacturing, homebuilding, agriculture, logistics, and especially energy—which often find themselves on the bad side of progressive regulation. Once these industries split their political contributions between the two major parties, but increasingly they are heading into the GOP camp.

This is particularly notable in the energy industry. With progressives clamoring for the virtual destruction of the fossil fuel industry as soon as possible, executives feel compelled to back the GOP. They know that as the green movement ups its demands, their heads are on the collective chopping block. In 1990, energy firms gave almost as much to Democrats as Republicans; in 2014 they gave over three times as much to the GOP. Other tangible sectors, including agriculture, homebuilding, and chemical manufacturing, which depends on cheap energy, seem also to be leaning to the GOP.

These corporate interests used to dominate fund-raising, but they are increasing out-gunned and out-spent by the rising tech and media sectors. This is where the big money is: In America , the media-tech sector in 2014 accounted for five of the top 10 wealthiest people. And just this year, the fortune of the poster boy of social media, Mark Zuckerberg, exceeded that of the Koch brothers, the much demonized scions of the old economy.

And these new-style oligarchs are, for the most part, much younger than their tangible industry rivals. Indeed, virtually all self-made billionaires under 40 are techies. And where once tech folk supported middle of the road candidates, there has been a steady “leftward” drift for the last 15 years. In 2000, the communications and electronics sector was basically even in its donations; by 2012, it was better than two to one Democratic. Microsoft, Apple, and Google—not to mention entertainment companies—all overwhelmingly lean to the Democrats with their donations.

This shift has occurred as the tech industry has moved away from its roots in aerospace and manufacturing to software and media. This realignment has relieved Silicon Valley of many traditional concerns with labor, energy prices, and basic infrastructure. When you are moving bits and bytes instead of building machines and circuits, you have less pressing interest in maintaining roads and having access to cheap energy. When virtually all your employees have degrees from elite colleges, or are imported technocoolies from India, you worry less about the cost of living or managing unions.

The Obama years have solidified these ties. Many former Obama aides now work for firms such as Uber, AirBnB, Google, Twitter, and Amazon. Tech also leans strongly toward cultural progressivism—support for gay marriage, abortion rights, and unrestricted immigration—and sympathy for the administration’s initiatives on climate change. They are not too concerned about higher energy prices for the middle and working classes, or their negative impact on basic industries. Climate change politics not only allows Silicon Valley and its Wall Street supports to feel better about themselves. It has also allowed venture firms and tech companies to profiteer on subsidies.

But class issues muck up this alliance of manna and idealism. Despite their hip and cool image, the tech oligarchs remain very much ruthless capitalists when it comes to preserving and expanding their wealth. Although Bernie Sanders rarely attacks the tech oligarchs directly, they recognize him as a threat. “They don’t like [Bernie] Sanders at all,” notes San Francisco-based researcher Greg Ferenstein, who has been polling Internet company founders for an upcoming book. “He’s an egalitarian liberal,” Ferenstein explains. “These people are tech liberals. Equality is a non-issue in Silicon Valley.”

Sanders seems not to get the memo—he prefers to demonize Wall Street—but The Washington Post, owned by super-oligarch Jeff Bezos, has taken particular pains to cut the Vermont socialist down to size. No surprise here, given the controversy over labor relations at Amazon, which, unlike Facebook or Google, actually has to employ blue-collar workers.

Most gentry and “tech liberals” appear to be aligning their vessels with Hillary Clinton’s now-listing “armada” of well-heeled tech, financial, and other cronies. Some of these same people have also donated quite generously to the ethically challenged Clinton Foundation.

And what about Wall Street, the biggest and most deserving target for class rage? Of course, the masters of the universe don’t like Bernie, the one candidate sure to oppose their interests. They are more than ready for Hillary, who, as Sanders repeatedly points out, has been taking their money in gigantic gobs. Security firms, for example, are the largest donors to Clinton’s super-pac, lagging behind only Jeb Bush in terms of money from this detested part of our economy.

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Yet the more Wall Street money dominates the race in both parties, the less voters seem willing to listen. Their GOP favorites have either lost or are on the way out, including Marco Rubio, who seemed poised to win Wall Street support with his confounding proposal—amidst concern with inequality and rapacious profiteering—advocating a zero capital gains rate. Unable to unite, they are now facing the real, unnerving possibility of Donald Trump or Ted Cruz as the party standard-bearer.

The Divided Middle Orders: The Yeomanry vs. the Clerisy

Big contributors may determine who stays in a race, and sometimes who wins, but most elections are settled by the middle class, which constitutes something close to half the population, and likely more of the electorate. Yet like the oligarchs, the middle class is also deeply divided between competing factions and interests.

The largest section of the middle class consists of what I call the yeomanry. This includes some 28 million small-business owners, many of whom employ one of more family members. Spread across a variety of fields, this sector constitutes the class most opposed to the Obama program. In fact, according to Gallup, in 2012 three-fifths of all small-business owners opposed Obama’s policies.

The reasons for this opposition are obvious. Progressive policies like higher minimum wages and stricter environmental and labor laws hit small businesses harder than bigger firms, which have the staff and resources to adapt to the regulatory vise. Once seen as the leading, creative edge of the economy, small business has not done well under Obama: For the first time in modern history, more firms (PDF) are going out of business than staying solvent.

But there’s another, more ascendant part of the middle class—highly educated professionals, government workers, and teachers—who have done far better under President Obama. In 2012, professionals generally approved of his regime, according to Gallup, by a 52 to 43 percent margin. These voters have become a critical part of the Democratic coalition; indeed, eight of the nation’s 10 wealthiest counties—including Westchester County in New York, Morris County in New Jersey, and Marin County in California—all went Democratic in 2012.

These middle-income workers increasingly do not work for the private economy; they occupy quasi-public jobs dependent on public dollars rather than private markets. Universities, a core Democratic constituency, have been hiring like mad: Between 1987 and 2011, they added 517,636 administrators and professional employees, or an average of 87 every working day.

This educated and often well credentialed middle class tends toward progressive politics; in fact, university professors have become ever more leftist, outnumbering conservatives six to one. Indeed, those voters with advanced degrees were the only group of whites by education to support Obama in 2012.

In modern America, these people serve largely as a clerisy, hectoring the public and instructing them how to live. A bigger state is not a threat to them, but a boon. No surprise that public unions and academics have emerged as among the largest and most loyal donors to Democrats.

The Democratic race is a largely a battle over securing the loyalty of this class. Clinton tends to dominate the already established clerisy—most notably the teachers unions and gay and feminist lobbies—and among older progressives. But the leaders are being deserted by the followers: Sanders won a decisive 56 percent of college-educated primary voters in New Hampshire.

The Lower Classes: The Precariat and the Traditional Lower Class

More Americans see themselves as belonging to the lower classes today than ever in recent times. In 2000 some 63 percent of Americans, according to Gallup, considered themselves middle class, while only 33 percent identified as working or lower class. In 2015, only 51 percent of Americans call themselves middle class while the percentage identifying with the lower classes rose to 48 percent.

The bulk of this population belongs to what some social scientists call the “precariat,” people who face diminished prospects of achieving middle-class status—a good job, homeownership, some decent retirement. The precariat is made up of a broad variety of jobs that include adjunct professors, freelancers, substitute teachers—essentially any worker without long-term job stability. According to one estimate, at least one-third of the U.S. workforce falls into this category. By 2020, a separate study estimates, more than 40 percent of Americans, or 60 million people, will be independent workers—freelancers, contractors, and temporary employees.

This constituency—notably the white majority—is angry, and with good cause. Between 1998 and 2013, white Americans have seen declines in both their incomes and their life expectancy, with large spikes in suicide and fatalities related to alcohol and drug abuse. They have, as one writer notes, “lost the narrative of their lives,” while being widely regarded as a dying species by a media that views them with contempt and ridicule.

In this sense, the flocking by stressed working-class whites to the Trump banner—the New York billionaire won 45 percent of New Hampshire Republican voters who did not attend college—represents a blowback from an increasingly stressed group that tends to attend church less and follow less conventional morality, which is perhaps one reason they prefer the looser Trump to the Bible-thumping Cruz, not to mention the failing Ben Carson.

Many Trump supporters are modern-day “Reagan Democrats.” Half of Trump’s supporters, according to a YouGov survey, stopped their education in high school or before. Trump’s message appeals to these voters in part by preserving Social Security and other entitlements. He appeals to populist rather than the usual GOP free-market sentiment, and decisively won all voters making under $50,000 a year. Tellingly, among Iowa Republican voters who called themselves “moderate or liberal,” Trump trounced Cruz, and duplicated the feat again in New Hampshire.

Conservative intellectuals dismiss Trump as both too radical and not conservative enough. He offends pundits in both parties by pushing things verboten in polite circles, such as trade with China, which has been responsible for the bulk of U.S. manufacturing losses. He also has embraced curbs on immigration, something that rankles the established leaders in both parties. “There’s a silent majority out there,” Trump says. “We’re tired of being pushed around, kicked around, and being led by stupid people.”

But if older, white Trumpians reflect the precariat’s past, young people flocking to Sanders’s camp may represent its future. Sanders destroyed Clinton among those under 30, winning their votes in both the Iowa caucuses and New Hampshire by six to one. These young voters may differ from generally older and whiter Trump voters on many key issues, but they also face a precarious future and diminished prospects. Over the past 40 years, few groups (PDF) have seen their incomes drop more than people under 30.

In a decade, these millennials will dominate our electorate and as early as 2024 outnumber boomers at the polls. They may be liberal on many social issues, but their primary concerns, like most Americans, are economic, notably jobs and college debt. Fully half, notes a recent Harvard study (PDF), already believe “the American dream” is dead.

For many millennials, Clinton-style incrementalism is less than enough. A recent yougov.com poll found some 36 percent of people 18 to 29 favor socialism compared to barely 39 percent for capitalism, making them a lot redder than earlier generations. No surprise that Sanders beat Clinton among younger voters. As one student, a Sanders backer, recently asked me, “Why should I support her? How is she going to make my life better?”

Below the precariat lie the traditional lower classes. Almost 15 percent of Americans live in poverty (PDF), and the trend over time has gotten worse. More than 10 million millennials are outside the system, neither in the labor force or education. This is just the cutting edge of a bigger problem: a labor participation rate which is among the lowest in modern history.

The low-income voters are helping both Trump and Sanders. The Vermont socialist won an astounding 70 percent of the votes among people making less than $30,000 a year. Trump’s largest margins were among both these voters and those making under $50,000 annually, who together accounted for 27 percent of GOP primary voters.

Class as the New Defining Issue

We are now experiencing a growth in class-based politics not seen since the New Deal. During the long period of generally sustained prosperity from the ’50s to 2007, class issues remained, but were increasingly subsumed by social issues—civil and gay rights, feminism, environment—that often cut across class lines. Democrats employed liberal social issues to build a wide-ranging coalition that spanned the ghettos and barrios as well as the elite neighborhoods of the big cities. Similarly, Republicans cobbled together their coalition by stressing conservative social ideas, free-market economics, and a focus on national defense; this cemented the country club wing with the culturally conservative suburban and exurban masses.

The chaos and constant surprises of this campaign represent the beginning of a new political era shaped largely by class. In November Trump hopes to ride the concerns of the white working class to victory in the Rust Belt to overcome Hillary Clinton’s coastal edge. Close to 20 percent of Democrats, according to Mercury Analytics surveys, plan to support Trump as their champion. In the coming months, the donor class, politicians, and pundits will be forced to address the needs of Trump’s supporters, as well as those of Sanders’s youth precariat in ways mainstream politicians have avoided for years.

As class politics reshape American politics, we are entering territory not explored for at least a half-century. Our political culture is being rocked in ways few would have anticipated just a few months ago.

Joel Kotkin is the Presidential Fellow in Urban Studies at Chapman University and executive director of the Center for Opportunity Urbanism in Houston. His book, The New Class Conflict, explored the evolving social conflicts of the 21st century. His next book, The Human City: Urbanism for the Rest of Us, will be published by B2 Books/Agate Publishing in April.