The Five American Socioeconomic Classes.

[AspieAlly613]

(The following is directly copy/pasted from my new Substack)

 

A great deal of political discourse tries to classify people into distinct socioeconomic classes, as if we were still living in a pre-capitalist feudal society. While we don’t have the same well-defined social castes that earlier societies had, it’s still reasonable to use socioeconomic classes as an approximation to describe the social/political divides in the United States. Where many people err is in the assumption that the main question in determining one’s socioeconomic class is “How much money does xe make?” However, that question on its own doesn’t actually tell you much about a given person.

 

I’ve learned this from my personal experiences. I live in Hartford, CT, where the median household income is roughly $35,000/year. My synagogue is a few miles away, in West Hartford, where the median household income is roughly $105,000/year. I work a tutoring internship and live alone, so my household income is slightly below that of Hartford, and well below that of West Hartford. Just from looking at my address and ZIP code, one might make some inferences about my lifestyle, viewpoints, and personality, but those would likely be inaccurate. To get a more accurate sense of me as a person, one needs only enter my apartment doorway into my living room, where xe would be greeted by three massive bookcases full of books (most of them math textbooks), two smaller bookcases, one with more books and one with puzzles with math-related solutions, such as spin-out and rubik’s cube, and two large chalkboards, marked with whichever calculation I had most recently done. When new neighbors see my living room for the first time, they never fail to be amazed by such a sight (all in the apartment just next door!)

 

It should come as no surprise that when socializing with people at my suburban synagogue, I fit in reasonably well (Asperger’s-related awkwardness aside), but that I’m culturally very different from my immediate geographic neighbors, despite my income figure being closer to theirs. A better question to ask than “How much money do I make” is “How do I earn my money.” As I see it, there are five main answers one could get to that question, corresponding to five different socioeconomic classes.

 

Worth noting is that the common perception is that people are largely envious of those in classes above them, and look down on those in classes below them. While the latter is definitely true, the former is not. Quite often, people have reasons for looking down on those in some classes above themselves as well, for reasons that I’ll discuss soon.

 

“I earn my money through investing capital and collecting returns.”—The passive income class.

 

This class has the potential to earn the most money because their earnings are proportional to capital invested rather than hours worked, and while some people can invest millions while others can’t, we’re all limited by the same 168 hours in a week. To give a sense of scale of just how much one can earn this way, suppose someone had $20,000,000 to invest. The long-term average stock market return rate is roughly 10% per year, while the long-term average inflation rate is roughly 3% per year. This means that, after 40% in taxes, xyr net worth would be increasing by $1,200,000 per year. Assuming xe used $100,000 for very comfortable living expenses, then xe’d be earning a roughly 2.5% return even after living expenses, inflation, and taxes. Assuming a 35-year generation gap and 2 kids per generation, those kids would inherit more than the original $20,000,000 each measured in present-value dollars, not future-value dollars. This would allow the rich to get richer while spending no time doing work.

 

This is where many people criticize the strategy. Passive income is not work, and it can feel unfair to see the wealthy earn more without spending time to work. Supporters of the system argue that if investors temporarily forgo access to their money and assume investment risk, then they are entitled to profits, and that the people running the projects benefit from receiving the investments, so we want to incentivize investment as a strategy. Heavy analysis into theories of fair exchange show that a passive income investment strategy is legitimate, but it’s unreasonable to hold most people to the standard of knowing that all in great detail. Suffice it to say that many people outside of the passive income class view the class as running an exploitative system.

 

“I earn my money through a job that took years of academic study.”—The academic class. 

 

This is my class, as it is for many of the aforementioned members of my suburban synagogue, as well as most people in the social circles I’ve ever been part of.  The perspective within this group is that in childhood, one is supposed to study a lot, resisting the temptations of laziness, or playing video games, or watching television, and that by being so well-behaved, xe’ll consistently get good grades, then go to college and pick a major, possibly get a graduate degree, and find work that almost no one can do because of the intensive, specialized study required.  This is viewed as the natural path that one needs no startup capital for, and that almost any hard-working student can build up the intelligence and skills to follow.  If a student doesn’t perform well in school, either xe has more than just a mild learning disability or a serious work ethic deficiency, supposedly.

 

Critics argue that this system is less meritocratic than it appears, as some expensive schools are better than cheaper public schools, and that students can only be expected to study as much as their local culture deems appropriate, giving lower-class students a disadvantage, and artificially inhibiting class mobility.  As an educator, I have quite a lot to say about what constitutes good/bad education, but that’s for another article.  Additionally, there’s a great deal of criticism from the manual labor class (described below) that working with one’s hands is a real job, but that thinking is not.  

 

“I earn my money through developing a craft through on-the-job training.”—The manual labor class.

 

This class, often called the “working class”, would probably object to being placed third, rather than second, on my list of classes.  As mentioned above, many of them think that their physically productive work is more important than academic “thinking” work.  However, because the common perception is that the academic social class is “above” the manual labor class, I’m presenting the classes in that order.  While the academic social class requires more diligent work starting from a younger age, the manual labor class requires more work upon graduation from high school, as working a job takes more time than going to college.  Thus, both the academic class and the manual labor class look down on each other.

 

“I earn my money by showing up to work every day and doing what my boss asks.”—The minimum wage class.

 

Workers in this class are doing jobs that any non-disabled person can do. (A large number of disabled people can do these jobs as well.)  Because of the ease of replacing these (essentially interchangeable) workers, they’ve historically been exploited, working too many hours for too little pay. The question “how much money should someone in this position work” often comes down to one’s belief of “how much should you earn for just showing up and doing the bare minimum?” Answers range from the socialist “you’re working the same number of hours as everyone else, you should earn the same as everyone else” to “enough to live very comfortably, so that a one-income household can earn triple the poverty level for a family of four,” to “just enough to be able to support a family of four,” to “if you can’t develop the skills to be more than a minimum-wage worker, you shouldn’t be a parent, you should only earn enough to support yourself.” Clearly, everyone thinks at least one of those opinions is ridiculous. Personally, I feel that jobs that require more preparation or training really do merit better pay, and my religious convictions dictate that breeding is a commandment, so I think the first and last opinions are ridiculous.

 

“Let’s talk about something else, this is making me uncomfortable.”—The contemporary peasantry.

 

These are people who, for whatever reason, can’t even get a minimum-wage job. Whether they lack the willpower to show up on time (possibly due to drug addiction) lack the focus/willpower to work with basic human efficiency (sometimes due to relatively severe disability), or have a history of threatening or otherwise being a negative presence to the employer, the place of business, or the other employees, these people are viewed negatively by almost everyone in the other classes. In this class are NEETs (Not in Employment, Education, or Training), people whose disabilities are severe enough to preclude them from getting work, and people who work disreputable jobs, such as drug sales or prostitution.

 

A number of people want those disreputable jobs to be better-respected. I caution those advocates to be careful what they wish for. In the case of drug sales, if hard drugs were legalized, then they would be sold by more trustworthy stores owned by wealthy entrepreneurs. If a current street drug salesperson has to resort to the trade because xe can’t reliably work a minimum-wage job, xe won’t be able to hold a job as a clerk for a cornerstore or supermarket that sells drugs either. In the case of prostitution, it would become another industry where it’s difficult to find clientele without an agency, and to be visible to these agencies, one would need connections and/or to work as an entry-level intern first. Considering the stories of the demands made of entry-level interns in most industries, I shudder to think how this would manifest in the field of prostitution.

 

I’ll close with a note from my own industry. In the tutoring industry, there is the equivalent of such a disreputable position: Some so-called tutoring jobs specifically seek those willing to engage in academic dishonesty. I made the mistake of applying to work with one last year, but when they didn’t give a satisfactory answer to what sort of verification I was allowed to collect from my students, I realized what kind of agency this was. For the most part, United States-based agencies strictly prohibit academic dishonesty, but those that allow tutors from countries with more struggling economies tend to be dominated by such disreputable “tutors”.

[Sally]

You left out a class.  When I was working fulltime, I earned my money through what used to be called "pink collar" jobs -- office jobs which didn't require an academic degree.  I worked for doctors, engineers, insurance brokers, academics, and the last 12 years of my worklife, as a self-taught paralegal.  That is a class that is probably the most heterogeneous of all the economic classes.   I had to support myself directly after high school, but had the cultural/intellectual interests that most academics do, and depending upon the milieu in which I worked, I either did or did not fit in with my office mates.  (When I worked at several universities, there was a large cadre of women workers in similar situations and of similar interests, who almost uniformly were treated badly by their academic bosses.  When I worked in engineering or insurance, there was no similarity.  In legal firms, it was a tossup.)  Experience taught me that when I was invited to parties or took classes, I should simply prevaricate when asked "And what do you do?"; otherwise, I'd be ignored.  

 

If you were to walk into my apartment, you'd see crammed bookcases and my own art on the walls, and hear music that's usually identified with someone with a different educational background.  And yet I have only a high-school diploma -- and barely that, since I'd decided during middle school that I'd pursue my own reading curriculum and thus made terrible grades and have huge gaps in various areas of knowledge.  My late partner through our decades together continued to be amazed when we'd be talking about something fairly complex and I'd come out with something that showed the holes in my knowledge.     

 

i think there must be quite a few of us out there, being mistaken for something we aren't, or not credited with being who we are, and having the lifelong experience of being not "this" or "that."    

 

  

[Myssterry]

5 minutes ago, Sally said:

i think there must be quite a few of us out there, being mistaken for something we aren't, or not credited with being who we are, and having the lifelong experience of being not "this" or "that."    

That resonates with me as a musician.  I only belong when with other musicians and music teachers, and even with them mostly with other instrumental teachers.  Performing and instrumental teacher musicians are not usually academics, but we trained for years and got diplomas/degrees at music colleges.  In fact I think in most ways you can think of I am not "this" or "that" and rarely have any sense of belonging.  For example, my dad was very working class in his background, but also socially mobile, so I am middle class.  However, I am beneath the public school strata, probably beneath the academic strata, but regarded as posh by the working class strata.   Can't win.  I am UK, so public school here is the upper crust. 

[ElloryJaye]

Yeah, the artistic class feels like it's missing from that round-up, along with other jobs with multiple intake routes that may be either academic or more on-the-job/apprenticeship (or combine them both).

 

There's also some split within the manual labour class, where fine craftsmanship can be regarded more highly than things like construction jobs.  Someone who hand-makes high quality classical guitars at thousands of dollars each isn't likely to fall into the same place, socially or economically, as a plumber, even though both are technically performing skilled, hands-on labour.

 

[Lysandre, the Star-Crossed]

I consider myself a member of the working class, a term I use to encompass the middle three classes in your list. I consider both the unworking rich and unworking poor to be my adversaries, economically and socially speaking. My animosity towards the unworking rich (my term for the "passive income" wealth folks) stems from a belief that they have not truly earned what they have. My disgust with the unworking poor (which is my term for people who are able but unwilling to work, therefore encompassing most people who don't provide for their own needs*) falls along similar lines, but in the absence of the welfare state would cease to exist. 

 

 

*The distinction between "labor" and "work" is important. I use the former to refer to any tasks completed, the latter to refer to employment. I don't consider my classification of the "unworking poor" to include those who consume the products of their own labor or those unable to provide for their own needs.

 

 

 

 

[Gloomy]

I went through years of academic study, but I still earn my money by showing up to work and doing what my boss says. ¯\_(ツ)_/¯ 

[Tetus]

I find it pretty cool how you group people with severe disabilities in with criminals. And by cool I mean, of course, reprehensible. So kind of an alternate definition of the word. 
 

Also.

 

7 hours ago, AspieAlly613 said:

Heavy analysis into theories of fair exchange show that a passive income investment strategy is legitimate, but it’s unreasonable to hold most people to the standard of knowing that all in great detail.

 

Citation, suffice to say, needed.

 

But also.

 

Class dynamics depend heavily on access to and control over resources. This is why the royalty/nobility/serf divide is useful to understand for understanding feudal structures. It is also why it makes sense to distinguish between the owning class and the working class under capitalism.
 

Historically, nobles and royals would explain that they were entitled to their positions through some other means than simply the fact that they presently controlled the land or the castles or the weapons or whatever - usually, divine mandate was brought in to explain the distinction between the classes. We now widely view this as being a weapon used by the nobility and the royalty to keep the serfs in their place.

 

So today, when you say that social class actually is unrelated to control of resources and really is about something else and, yknow, it just so happens that this causes the owning class to benefit the most, but really it’s not ABOUT that…I feel like I’ve heard this song and dance before.

 

 

[Guest]

1 hour ago, Epic Tetus said:

So today, when you say that social class actually is unrelated to control of resources and really is about something else and, yknow, it just so happens that this causes the owning class to benefit the most, but really it’s not ABOUT that…I feel like I’ve heard this song and dance before

I think that's called revisionism, maybe? Just a little bit? Its certainly reactionary and seems to put the onus of people being poor on the poor themselves, as if through some miracle cause and effect doesn't apply to human social conditions. But what do I know, I'm just a degenerate leftists...😂 

@Epic Tetus I am agreeing with you, I hope some of the sarcasm come through.😂😂

[Still]

28 minutes ago, FSENonServiam said:

Its certainly reactionary and seems to put the onus of people being poor on the poor themselves, as if through some miracle cause and effect doesn't apply to human social conditions.

Americans are just obsessed with prosperity gospel, if not in the religious sense, then in the sense that rich people are that way because they are good and deserve it, while the poor are that way because they are bad and deserve it.

 

The OP is definitely full of Reagan-esque portrayals of the poor, right down to the nefarious drug dealer.

[weird elf]

7 hours ago, Myssterry said:

That resonates with me as a musician.  I only belong when with other musicians and music teachers, and even with them mostly with other instrumental teachers.  Performing and instrumental teacher musicians are not usually academics, but we trained for years and got diplomas/degrees at music colleges.  In fact I think in most ways you can think of I am not "this" or "that" and rarely have any sense of belonging.  For example, my dad was very working class in his background, but also socially mobile, so I am middle class.  However, I am beneath the public school strata, probably beneath the academic strata, but regarded as posh by the working class strata.   Can't win.  I am UK, so public school here is the upper crust. 

SS, DC (same shite, different country).

[Janus the Fox]

The 'born sick and disabled with family both sick and disabled with no prospect of realistic employment despite 7 years of formal academic training in the computing field' class

 

But I've done some 'virtual voluntary and fictional jobs on 4 platforms' which I got going for me, which is nice

 

Really my day is completely filled between pain, managing disability, health, the disability and health of both parents and the stuff I do between AVEN, Discord, Second Life and Reddit.  a tiny bit of time with the BF is cool too.

 

Really my life cannot revolve having any employment, too many responsibilities at home and my physical safety risks are high enough.  No real free time

[AspieAlly613]

8 hours ago, Sally said:

You left out a class.  When I was working fulltime, I earned my money through what used to be called "pink collar" jobs -- office jobs which didn't require an academic degree.  I worked for doctors, engineers, insurance brokers, academics, and the last 12 years of my worklife, as a self-taught paralegal.  That is a class that is probably the most heterogeneous of all the economic classes.   I had to support myself directly after high school, but had the cultural/intellectual interests that most academics do, and depending upon the milieu in which I worked, I either did or did not fit in with my office mates.  (When I worked at several universities, there was a large cadre of women workers in similar situations and of similar interests, who almost uniformly were treated badly by their academic bosses.  When I worked in engineering or insurance, there was no similarity.  In legal firms, it was a tossup.)  Experience taught me that when I was invited to parties or took classes, I should simply prevaricate when asked "And what do you do?"; otherwise, I'd be ignored.  

 

4 hours ago, ElloryJaye said:

Yeah, the artistic class feels like it's missing from that round-up, along with other jobs with multiple intake routes that may be either academic or more on-the-job/apprenticeship (or combine them both).

 

There's also some split within the manual labour class, where fine craftsmanship can be regarded more highly than things like construction jobs.  Someone who hand-makes high quality classical guitars at thousands of dollars each isn't likely to fall into the same place, socially or economically, as a plumber, even though both are technically performing skilled, hands-on labour.

 

These points thoroughly demonstrate that my analysis in incomplete.  Thank you.

[AspieAlly613]

3 hours ago, Epic Tetus said:

I find it pretty cool how you group people with severe disabilities in with criminals.

I definitely needed to clarify what I meant there.

 

First of all, this was largely a description of the social class system, not necessarily saying that this is how it should be.  With that in mind, my experience in disability advocacy circles indicates that, yes, it is acknowledged that people whose disabilities are so severe as to prevent them working are viewed as bottom-class.  On the one hand, there are the more radical advocates who argue that no capitalist system can possibly be fair to disabled people because they are viewed as bottom-class.  On the other hand, there are the more pragmatic advocates arguing that workplaces should make accommodations to make it feasible for disabled people to work there (for example, making buildings wheelchair-accessible and enabling most jobs to be done in a seated position) because working a job (even a minimum-wage job) is preferable to living off of disability benefits.

[AspieAlly613]

3 hours ago, Epic Tetus said:

So today, when you say that social class actually is unrelated to control of resources and really is about something else and, yknow, it just so happens that this causes the owning class to benefit the most, but really it’s not ABOUT that…I feel like I’ve heard this song and dance before.

I don't think that's what I said.  When I described the owning class, I specifically said "this is only possible if you already have a lot of money."

[nanogretchen4]

Why is working even a minimum wage job preferable to living off disability benefits? It clearly has nothing at all to do with the dignity or intrinsic value of work since it is fine and dandy for those with inherited wealth to live off of passive income. 

[Tetus]

25 minutes ago, AspieAlly613 said:

I definitely needed to clarify what I meant there.

 

First of all, this was largely a description of the social class system, not necessarily saying that this is how it should be.  With that in mind, my experience in disability advocacy circles indicates that, yes, it is acknowledged that people whose disabilities are so severe as to prevent them working are viewed as bottom-class.  On the one hand, there are the more radical advocates who argue that no capitalist system can possibly be fair to disabled people because they are viewed as bottom-class. 

This is wildly confusing to me for a lot of reasons. Would this class analysis put Pablo Escobar and someone living on disability in the same social class? If it would, why? Other than the terms you made up, why is it useful for us to conceptualize them as part of the same class? Do they share class interests? Do they wield similar levels of influence in society? What, basically, does class even mean in this conception of the term?

 

In most conceptions of class, we see broad alignment of interests. For instance, taxing capital gains would affect the owning class, but not the working class. Refusing to increase minimum wage along with rising productivity and inflation harms the working class, but not the owning class. And so on.
 

1 minute ago, AspieAlly613 said:

I don't think that's what I said.  When I described the owning class, I specifically said "this is only possible if you already have a lot of money."

This is what you said:

 

11 hours ago, AspieAlly613 said:

Where many people err is in the assumption that the main question in determining one’s socioeconomic class is “How much money does xe make?” However, that question on its own doesn’t actually tell you much about a given person.

[…]

A better question to ask than “How much money do I make” is “How do I earn my money.” As I see it, there are five main answers one could get to that question, corresponding to five different socioeconomic classes.

[RoseGoesToYale]

Wow. This is the most elitist, ableist, and stunningly inaccurate thing I have ever read on this forum.

[AspieAlly613]

3 hours ago, Epic Tetus said:

Also.

 

11 hours ago, AspieAlly613 said:

Heavy analysis into theories of fair exchange show that a passive income investment strategy is legitimate, but it’s unreasonable to hold most people to the standard of knowing that all in great detail.

 

Citation, suffice to say, needed.

 

Sure, here's a more detailed explanation.

 

Consider the case of the person who already has $20,000,000 sitting around.  Clearly, xe's allowed to use xyr money.  Here are two examples of how xe could do it, one legitimate and one illegitimate:

 

Legitimate case:

Purchase 2% of a billion-dollar, publicly traded company, and receive 2% of the annual profits of that company.

 

Illegitimate case:

Purchase the entirety of a $20,000,000 company, then reduce all employees' wages until they're just barely preferable to leaving the company/starting a new job search, making the employment arrangement still mutually-beneficial, but far too lopsided in favor of the new owner.

 

The big question is how to tell whether an investment is closer to the legitimate case or the illegitimate case.  There are a few key ingredients to making the illegitimate case possible:

 

• The ability to walk away from a deal when the other can't reasonably do so
• Some mechanism preventing almost everyone from replacing you in your side of the deal, making a better offer.  (Either you have exclusive rights or it requires a significant initial down payment).
• Any means of obscuring the true value of the goods/services being negotiated.

 

There definitely are cases where the above are satisfied, and that's why government regulation is needed.  However, consider the case of stock market investments.  It's rare for someone to need to buy/sell shares of a given stock, most stock shares are cheap enough that almost anyone putting money towards retirement could buy at lest one share per month, and current face values of stock shares are widely known.  Outside of some extreme behavior such as insider trading or collusion to inflate/deflate prices, stock market transactions can be considered legitimate.

 

In the case I cited in the article, passive income was achievable through stock market transactions alone.  What about the case of business ownership, where the business owner can alter prices/wages to be exploitative?  How do we know whether the business owner is being fair or not?

 

To answer that, we need to define the required rate of return for an investment project.  This is the minimum annualized return that the investor should consider acceptable.  It depends on the uncertainty associated with the prospects of the investment (called the volatility of the investment) as well as the extent to which fluctuations in the returns of the investment would correlate with the stock market overall.  The theory is that the investor must ask the question "If I were to invest through some combination of the stock market and risk-free treasury bills, what combination would get me the same volatility as the proposed investment project, and what would the resulting expected rate of return be?"  The resulting formula is:

 

required rate of return = risk-free interest rate + (stock market interest rate - risk-free interest rate) × (volatility of investment project)/(volatility of stock market) × correlation coefficient between investment project returns and stock market returns.

 

The formula itself isn't that important for this discussion, what is important is that the formula exists. 

 

So, we have the formula for the minimum amount that the owner should earn.  What about the minimum amount that the workers should earn?  That's a lot more subjective and industry-dependent and depends on the opinions of individual workers.  If the minimum demanded salary is high enough that it makes it impossible for the investor to earn the required rate of return, then the investment shouldn't happen and the industry shouldn't exist.  In the more common case where there is some overlap of wages high enough to satisfy workers and low enough to satisfy the owner, then the question is "where within that range should salaries be set?"  Obviously, that would have to happen by negotiation.  If it's a negotiation between one owner and each individual worker, then the owner has too much power.  If the workers unionize so that it becomes a negotiation between the owner and the union leader, then it's probably a fair negotiation and a fair wage.

 

Short version:  The example I cited is an example of legitimate passive income, as for other cases, one needs to scrutinize the fairness of the negotiation process.

[AspieAlly613]

57 minutes ago, Epic Tetus said:

This is what you said:

 

12 hours ago, AspieAlly613 said:

Where many people err is in the assumption that the main question in determining one’s socioeconomic class is “How much money does xe make?” However, that question on its own doesn’t actually tell you much about a given person.

[…]

A better question to ask than “How much money do I make” is “How do I earn my money.” As I see it, there are five main answers one could get to that question, corresponding to five different socioeconomic classes.

Thanks for clarifying.  Here's another counterexample to the "your social class is based on your income" theory.  According to this web page the average prostitute earns considerably more than the average lifeguard.  However, I would guess that more prostitutes than lifeguards are worried about what people will think of them if they find out their professions.

[AspieAlly613]

1 hour ago, nanogretchen4 said:

Why is working even a minimum wage job preferable to living off disability benefits? It clearly has nothing at all to do with the dignity or intrinsic value of work since it is fine and dandy for those with inherited wealth to live off of passive income. 

The subtlety here is that the one with inherited wealth is engaging in exchange which the counterparty considers reasonable.  (Investment is always an exchange, even if it doesn't look like it.)  In contrast, if someone with inherited wealth is just spending the family fortune (with no passive income) and not engaging in volunteer work, my impression is that most people do not view that person particularly favorably.

 

If you're trying to ask "should working a minimum wage job be preferable to living off disability benefits?" That's the subject of debate between the two perspectives on disability advocacy that I mentioned earlier.

[AspieAlly613]

1 hour ago, RoseGoesToYale said:

Wow. This is the most elitist, ableist, and stunningly inaccurate thing I have ever read on this forum.

To clarify, this was intended primarily as a description of our current society, not necessarily an ideal society.  IF you have the mental energy and desire to write out a more detailed response, I'd be interested in your perspective.  (The discussion up until now has certainly been engaging.)

 

I'd like to provide some food for thought based on one word you used.  You described my article as "elitist".  Suppose I had inverted my rankings of the socioeconomic classes, placing passive income at the bottom, the academic social class one level above them, etc.  I would guess that had you described that hypothetical article as "elitist", people would be confused, thinking "but this is speaking negatively about the elite."  If so, that would support my hypothesis on which classes are considered to be above/below others in our current society.

[Guest]

The Marxian idea of primitive accumulation puts the lie to any concentration of resources being legitimate in the first place, such that if the initial gathering is illegitimate then any money made from it is illegitimate as well. 

[Tetus]

You have a lot of assumptions that you’re baking in here, and they’re worth challenging, particularly in a discussion about class, and particularly when one of your assumptions is this:

Quote

Consider the case of the person who already has $20,000,000 sitting around.  Clearly, xe's allowed to use xyr money. 

I’m not totally clear on this. Now, 20 million is actually a weird number for this example, because while I highly doubt that I will ever have anything like that much money, if the richest people in society topped out at 20 million, I’d be more amenable to the idea that capitalism might work. But it isn’t where people top out, and so the question that needs to be asked is: what provides the justification for one person to casually control hundreds of times more wealth than most people earn in a year? You might think there is a justification for that, but it is hardly self-evident.

 

Then we have this:

 

Quote

How do we know whether the business owner is being fair or not?

[…]

To answer that, we need to define the required rate of return for an investment project.  This is the minimum annualized return that the investor should consider acceptable. 

 […]

So, we have the formula for the minimum amount that the owner should earn.

Woof. Um, this might be sound investment advice, but that doesn’t mean this is an okay way to make your money that everyone should be okay with. There’s nothing in all of this that actually provides that justification. It’s just a long discussion of what someone should do if they want to get a return on investment. As a parallel here, I could provide detailed instructions outlining the best way to club a baby seal, but that would not constitute a justification for actually doing the clubbing.

 

Next, this:

 

1 hour ago, AspieAlly613 said:

Thanks for clarifying.  Here's another counterexample to the "your social class is based on your income" theory.  According to this web page the average prostitute earns considerably more than the average lifeguard.  However, I would guess that more prostitutes than lifeguards are worried about what people will think of them if they find out their professions.

This is where your position veers into incoherence. Because pretty much anyone could be a lifeguard or a prostitute, right? So you would actually say they are the same class, yes? So then, what are you trying to say above?

 

I think that you are running into difficulty with the concept of socioeconomic class. You’ve focused exclusively on the social aspect, hence your fixation on whether people think a particular type of person is “good”. This is how your prostitute/lifeguard comment makes sense. But the economic part is really important, because at the end of the day, if you can wield enough resources to do whatever you want, the public’s opinion of you is irrelevant.

People generally don’t think much of pornographers, but someone who owns a massive pornography business is clearly not part of the working class. I don’t think anyone actually likes the Kardashians, but once again, they are clearly not lower class. They might not be “classy” and someone like Trump might be said to lack “class”, but no one is claiming that these people are part of the proletariat, yeah?

 

So basically, your framework doesn’t attempt to describe class as it is normally understood - it attempts to describe something like ‘respectability’, though as I mention above, I don’t think it does that particularly well.

 

And there’s another thing. You make the claim that money doesn’t produce class, but rather the source of that money, but you then you say, ‘clearly a rich person can use their wealth as they see fit’. You don’t qualify that with, ‘assuming their wealth was gained in a high class way’ - the simple fact of having capital grants them the privilege of engaging in earning money in a high class manner. I just think that’s interesting.

[Sally]

3 hours ago, nanogretchen4 said:

Why is working even a minimum wage job preferable to living off disability benefits? It clearly has nothing at all to do with the dignity or intrinsic value of work since it is fine and dandy for those with inherited wealth to live off of passive income. 

Who decided it was fine and dandy, and why?  That sounds like sarcastic criticism rather than an actual charge that anyone thinks that it is so.  However, it's possible -- or likely -- that anyone who does think that assumes that the person with inherited wealth is at least not living off the taxes paid by those who do work, which is the case of people receiving disability benefits.  (Of course that completely ignores the cost to society of inherited wealth.) 

[nanogretchen4]

The OP decided it was fine and dandy based on his theory of fair exchange. I think there is no such thing as a fair exchange when you have the ludicrous imbalances of wealth and power that have been allowed to exist in our broken system. I also think that we should close the tax loopholes and tax the billionaires until there aren't any billionaires. I'll bet that will provide plenty of money to cover disability without oppressing the modestly middle class.

[AspieAlly613]

10 minutes ago, Epic Tetus said:

This is where your position veers into incoherence. Because pretty much anyone could be a lifeguard or a prostitute, right? So you would actually say they are the same class, yes? So then, what are you trying to say above?

Oh, I was saying that sex work has a certain stigma to it that makes it tier 5, not tier 4.  Whether we like it or not, the stigma clearly exists in 2022.

 

12 minutes ago, Epic Tetus said:

I think that you are running into difficulty with the concept of socioeconomic class. You’ve focused exclusively on the social aspect, hence your fixation on whether people think a particular type of person is “good”. This is how your prostitute/lifeguard comment makes sense. But the economic part is really important, because at the end of the day, if you can wield enough resources to do whatever you want, the public’s opinion of you is irrelevant.

A fair point!  In the future, I should probably describe this more as "social class associated with occupation."  Your point about the pornography industry and the Kardashians illustrates this as well.  Thanks for the critique.

 

29 minutes ago, Epic Tetus said:

what provides the justification for one person to casually control hundreds of times more wealth than most people earn in a year?

Short version:  the justification is that each of the individual transactions was just.  

 

Longer version that doesn't get into circular reasoning:  First, be mindful that other people having more money is not directly a detriment to you.  The inequality itself is not a problem.  It's grounds for scrutinizing how one person amassed so much wealth, and earlier I described one scenario where it would be fine, and one scenario where it wouldn't.

 

Things start to go wrong if we start voiding transactions because we don't like who's involved.  Suppose $20,000,000 is needed for some project.  If that sum comes from one person, we have the situation in question.  If it comes from 20,000 people each investing $1,000, that would avert the concentration of wealth.  However, once we start saying "people should be allowed to invest, but not this person in particular," that gets dicey.  Also, typically such business ventures would lead to public benefit.  (It's hard to sell stuff that leads to public detriment, though not impossible, as the fossil fuel industry indicates.)  For example, many US cities are facing housing crises.  The most straightforward approach is to build more homes to drive vacancy rates to a healthy 8%-10%.  To do that, someone or a group of people needs to invest enough money to construct entire apartment buildings.  If we were to prohibit all ultra-high net worth people from investing, it would be harder to find the funds to build, and those buildings would never get built.

 

48 minutes ago, Epic Tetus said:

Woof. Um, this might be sound investment advice, but that doesn’t mean this is an okay way to make your money that everyone should be okay with. There’s nothing in all of this that actually provides that justification. It’s just a long discussion of what someone should do if they want to get a return on investment. As a parallel here, I could provide detailed instructions outlining the best way to club a baby seal, but that would not constitute a justification for actually doing the clubbing.

Here's the justification:  A worker is in the right to say "In most industries of this sort, the salary is $X, I shouldn't have to work for much less than $X."  Similarly, a business owner is in the right to argue "I could earn a return of $X for the same investment with the same volatility by investing in the market/T-bills.  I shouldn't have to settle for a return of less than $X."

[nanogretchen4]

Let's go back to the step where someone has $20,000,000 lying around. First, how did this person acquire $20,000,000 in the first place? Second, why don't we fix our tax system so some people don't have $20,000,000 lying around while others don't have homes and food? Third, what has to be wrong with someone that they would hoard $20,000,000 while others lack homes and food? And now let's ask those same questions for $1,000,000,000.

[Guest]

33 minutes ago, AspieAlly613 said:

each of the individual transactions was just

How so? Its nice to see that you've ignored my critique, probably because its Marxian in nature, but if a person acquires their wealth immorally, passes it around, then someone else gets it and lives off the interest or investment returns, how is that legitimate? I get your neoliberal leanings but its still a big roadblock in any discussion of the legitimacy of capitalism. 

[nanogretchen4]

Extreme inequality of wealth is extreme inequality of power, and that is absolutely the problem. 

[RoseGoesToYale]

3 hours ago, AspieAlly613 said:

To clarify, this was intended primarily as a description of our current society, not necessarily an ideal society.  IF you have the mental energy and desire to write out a more detailed response, I'd be interested in your perspective.  (The discussion up until now has certainly been engaging.)

 

It's not a description of current society. It completely ignores intergenerational wealth AND intergenerational debt as predictors of upward and lateral mobility, suggests that educational attainment is reliable predictor of income (which was true up until my generation, because my generation has had to take on staggering amounts of debt to achieve the same level of college education as previous generations, even though the increasing number of diplomas is diluting their workplace value. Over one third of college graduates are underemployed, and let's not forget about the highly educated K-12 teachers, untenured college instructors and adjuncts who are scraping for pennies), also completely ignores social structures that keep certain people within a certain wealth bracket, such as structural racism, redlining, gerrymandering, anglosupremacy (and a government that refuses to teach English), or (lack of) social networks.

 

Overall, the piece runs on unsubstantiated assumptions. Where are your sources for your data? Also, what are the income and/or wealth brackets for each category you mention? Each category beside the first is a broad generalization of how where each category is on a money scale based on the type of work done, but incomes can vary greatly across field, skill and time/place spent doing one occupation. 

 

17 hours ago, AspieAlly613 said:

This class, often called the “working class”, would probably object to being placed third, rather than second, on my list of classes.  As mentioned above, many of them think that their physically productive work is more important than academic “thinking” work.

What are you considering a "working class" job here? Are you going by income or nature of work? E.g. a white collar office worker and a blue collar auto mechanic might make the same salaried income based on a number of factors, but your assumption of non-physical "thinking" work and physical "non-thinking" work as two different socioeconomic rungs on the ladder would place the auto mechanic in a lower socioeconomic class than the office worker, despite the same income and possibly the same lifestyle outside work.

 

17 hours ago, AspieAlly613 said:

Workers in this class are doing jobs that any non-disabled person can do. (A large number of disabled people can do these jobs as well.)

So... they're both jobs any non-disabled person can do, but also that disabled people can do. What do said workers have, Schrödinger's disability? Also, have you considered the fact that disabled people can hold jobs requiring a college education and thus be higher up on the socioeconomic ladder?

 

17 hours ago, AspieAlly613 said:

“how much should you earn for just showing up and doing the bare minimum?”

This assumes that workers in wage jobs don't work hard and they deserve low pay because they don't work hard.

 

17 hours ago, AspieAlly613 said:

These are people who, for whatever reason, can’t even get a minimum-wage job. Whether they lack the willpower to show up on time (possibly due to drug addiction) lack the focus/willpower to work with basic human efficiency (sometimes due to relatively severe disability), or have a history of threatening or otherwise being a negative presence to the employer, the place of business, or the other employees, these people are viewed negatively by almost everyone in the other classes. In this class are NEETs (Not in Employment, Education, or Training), people whose disabilities are severe enough to preclude them from getting work, and people who work disreputable jobs, such as drug sales or prostitution.

It's obvious you have never been poor, nor known anyone who falls below the poverty line. This completely ignores the myriad of societal barriers that a person already denied any intergenerational wealth at all will face in trying to get a job. You need a home address to apply for a job. If you're homeless, that means you can't get a job no matter how much you want one or hard a worker you are. If you don't have a job (i.e. proof of income), you can't apply for housing, no matter how clean and straight you are. It's a self-perpetuating cycle. What do you when your mental health is shit and you can't afford therapy? You turn to drugs. Also, sex work (prostitute is a slur) is work, which brings income, and not all sex work is illegal, such as porn acting or recording oneself online, meaning that sex workers are not unemployed with no money. This entire list is very moralistic, grouping people into socioeconomic categories based on (whose?) perception of who deserves what job and what income/wealth.

 

Across social studies, socioeconomic groups are broken down into five different categories: upper class, upper-middle class, middle class, lower-middle class, and poor. Adjusted for inflation from 2019, in the US each group is categorized in the following yearly income brackets for a family of three:

- Upper class: $433,349 and above

- Upper-middle class: $123,814 to $433,349

- Middle class: $61,906 to $123,814

- Lower-middle class: $37,144 to $61,906

- Poor: $37,144

 

In 2022, a person with a salaried income of $3083 (or roughly $16.75 per hour at an 8-hour a day job) per month will fall below the poverty line, regardless of the perceived "prestige" of the job. An entry level K-12 teaching position in my state of Florida pays a salary of $26,733, well below the poverty line, despite that entry into the position requires AT LEAST a bachelor's degree and a teaching certificate and passed assessments on the subject to be taught and interning as a teacher's assistant. A literal ton of education and training, all to still wind up in the lowest socioeconomic class.