The Establishment

The old WASP elite is long gone—but not the populist hostility it provoked

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Dean Acheson, Secretary of State and Lewis Douglas, U.S. Ambassador to Britain in 1950

 Why do we introduce an  article on the political establishment into a blog about economic inequality? Because the original East Coast establishment of the ‘50s and ‘60s was so closely associated with that post-World War II period when inequality was at its lowest.

The establishment: It is a name to conjure with and curse in American politics. Donald Trump has denounced the GOP establishment at every turn in his march to the Republican nomination, though he has lately made a few peace offerings. And on the Democratic side, the left is still energized by Bernie Sanders ’s candidly antiestablishment campaign even as Hillary Clinton looks ahead to the general election.

But what is this establishment anyway? Why is it so often discussed but never defined? Does it even exist?

In 19th-century Britain, “establishment” meant the state church, but historians such as Thomas Macaulay and Thomas Carlyle reinterpreted it to refer more generally to the society’s dominant leaders and institutions. In the U.S., the term became a synonym for the immense authority once exercised by the White Anglo-Saxon Protestant upper class, in an era when the influence of big Eastern corporations, investment banks and law firms pervaded politics and national development.

The establishment was the closest thing the U.S. had to an aristocracy, and unsurprisingly, it provoked powerful populist resentments. In the 19th century, populists raged against everything they associated with the East: banks, railroads, cities, immigrants, cosmopolitanism and privilege. In the 1950s, the populist, red-baiting Sen. Joseph McCarthy condemned the establishment—represented by Harvard, the Episcopal Church, the Army’s top brass and posh diplomats like Dean Acheson —as a traitorous elite.

When the journalist Richard Rovere popularized the idea of the establishment in the early 1960s, he had in mind not so much the entire WASP upper class as a small number of talented men who circulated among high positions in government, Wall Street, the Ivy League, the national media and philanthropic foundations. They adhered to a gentlemanly code of loyalty, pragmatism and noblesse oblige and saw public service as both an honor and an obligation. Like the Founding Fathers, they believed that the national interest was more important than partisanship. Henry Stimson, the quintessential establishment “Wise Man,” served as secretary of war under both Republican President William Howard Taft and Democratic President Franklin D. Roosevelt.

To the conspiracy-minded, this bipartisan establishment was the country’s invisible government. Phyllis Schlafly, in her best-selling1964 tract “A Choice Not an Echo,” asserted that America’s so called democracy was controlled by “secret kingmakers,”a shadowy group made up mostly of New York internationalist bankers. This establishment supposedly selected the presidential nominees of both parties, dictated the outcome of elections through “brainwashing and propaganda blitzes,” and“work[ed] toward ‘convergence’ between the Republican and Democratic parties.”

Only the paranoiacs of the John Birch Society took Ms. Schlafly’s claims seriously, but establishment grandees did exercise considerable influence on politics, particularly on the Republican side. In 1952, pressure from the establishment played a critical role when the Republican national convention picked Dwight Eisenhower as its presidential nominee over conservative favorite Robert Taft.

By the 1960s, however, the establishment’s authority waned as the East lost the preponderance of economic and cultural power that had undergirded its political influence. Between the end of World War II and the mid-1960s, the population of the South and West almost doubled while that of the North and East shrank. At the same time, the Northeast lost its dominant role in manufacturing, banking and other key sectors.

The establishment’s diminished hold over the GOP was evident in its failure to prevent Arizona Sen. Barry Goldwater from becoming the party’s nominee in 1964. Eastern establishment Republicans typically were moderates in the mold of Eisenhower, and they recoiled from Goldwater’s radical antigovernment views and courtship of Southern segregationists. But there was little they could do to prevent his grass-roots movement from gaining a majority of delegates at the Republican national convention.

As for the left, it had a critique of its own. The journalist David Halberstam blamed the debacle of the Vietnam War on “the best and brightest,” while New Left activists saw the establishment as the repressive driver of U.S. imperialism, racism and inequality.

Even as the establishment slowly vanished from political life, however, it retained its hold on the popular imagination. The term still conjures up malign associations for both the right and the left, which is why it has been invoked so much lately.

Mr. Trump knows that Reince Priebus, the chairman of the Republican National Committee, is no one’s idea of an aristocrat. The RNC, for that matter, no longer exercises significant influence over the GOP, since its centralized authority has been eclipsed by the conservative media and a diffuse array of PACs, super PACs, outside organizations and billionaire donors.

Still, by branding the party leadership as “the establishment,” Mr. Trump has put the RNC on the defensive and tapped into deep-seated populist animosities. Mr. Sanders has done the same on the Democratic side.

If this election season has proven anything, it is that traditional sources of authority don’t carry much weight anymore. Americans don’t trust any of their major institutions, with the possible exception of the armed forces. Mr. Trump’s supporters don’t care that the pundits think that he is unpresidential, just as Mr. Sanders’s supporters don’t care that the “experts” consider his proposals unrealistic.

Polls suggest that Americans, more than ever before, feel oppressed by forces beyond their control. Much of the appeal of outsider candidates like Mr. Trump and Mr. Sanders stems from the widespread belief that neither political party is interested in ordinary people and that the American dream is no longer in reach for those who work hard and play by the rules. “Establishment” has become shorthand for a corrupt power structure and a rigged system.

The late sociologist E. Digby Baltzell didn’t think the establishment’s disappearance would lead to a freer and happier democracy. On the contrary, he predicted that it would be replaced by “naked power veiled in manipulation and deceit,” the unchecked influence of money and propaganda, an antipathy to all institutions and widespread belief in conspiracy theories.

The problem with present-day politics isn’t the invisible domination of an oppressive establishment—those days are long gone—but rather the absence of any authority that Americans still trust and respect.

Geoffrey Kabaservice, who wrote this article for the Wall Street Journal, is the author of, among other books, “The Guardians: Kingman Brewster, His Circle, and the Rise of the Liberal Establishment.”

Annotated Bibliography

Books About the Very Rich

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Liar’s Poker by Michael Lewis

A hilarious first-hand account of young men and women working on the trading floor of Salamon Brothers investment bank.

Flash Boys: A Wall Street Revolt by Michael Lewis

An insider’s look at high-frequency trading where investment bankers take advantage of high speed computers to buy or sell a fraction of a second before their competitors.

The Big Short by Michael Lewis

The inside story of the how the financial crisis of 2008 came about, from which the recent award-winning film was made.

Dark Money: The Hidden History of the Billionaires Behind the Rise of the Radical Right by Jane Meyers

The author shows how a network of exceedingly wealthy people with extreme libertarian views bankrolled a systematic, step-by-step plan to fundamentally alter the American political system.

Plutocrats: The Rise of the New Global Super Rich and the Fall of Everyone Else by Chrystia Freeland

This book is an attempt to understand the changing shape of the world economy by looking at those at the very top: who they are, how they made their money, how they think and how they relate to the rest of us.

Winner-Take-All Politics: How Washington Made the Rich Richer – And Turned Its back on the Middle Class by Jacob S. Hacker & Paul Pierson

The good news reported by Hacker and Pierson is that American wealth disparities are not the residue of globalization or technology or anything else beyond our control, but of politics and policies which tilted toward the rich beginning in the 1970s and can, over time, be tilted back.

Listen, Liberal: Or What Ever Happened to the Party of the People? by Thomas Frank

The professional class, the teachers, lawyers, doctors, architects, etc., on whom our country has counted for so long to remain objective, above the political fray, and steer our democracy over the shoals of greed and corruption and self-interest, has lost its objectivity, no longer associates itself with the working class, the labor unions, the unlucky, and has joined the rarified ranks of the well-educated and the privileged.

Books About the Poor

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The Other America: Poverty in the United States by Michael Harrington

First published in 1962, this book is regarded as a classic work on poverty. “That the poor are invisible is one of the most important things about them. They are not simply neglected and forgotten as in the old rhetoric of reform; what is much worse, they are not seen,” wrote the author.

The American Way of Poverty: How the Other Half Still Lives by Sasha Abramsky

Today, after four decades during which tackling economic hardship took a distant backseat to other priorities, one in six Americans live below the poverty line, their live as constricted as those that peopled the pages of The Other America in the Kennedy era. Why?

American Hunger by Eli Saslow

Nearly 1 in 7 Americans – and almost a quarter of all children – now receive food stamps, the highest participation in the program’s history. Hunger remains the lasting scar of the recession.

$2.00 a Day: Living on Almost Nothing in America by Kathryn J. Edin

The author actually restricts herself to $2.00 a day in order to be able to write first-hand about the experience.

Labor’s Love Lost: The Rise and Fall of the Working-Class Family in America by Andrew J. Cherlin

The author, a sociologist teaching at Johns Hopkins University, is convinced that the traditional working-class family, where the husband has a job that supports all of them and his wife is the full-time house-keeper, that was the backbone of traditional America, is a thing of the past and that a totally new child-rearing arrangement between men and women is emerging to meet the very different economic organization we will be living in.

Books about Our Situation: How We Got into it and How We Can Get Out

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The Wealth of Nations by Adam Smith

Where it all began. The book from which the founding fathers fashioned our economic system.

On Liberty by John Stuart Mill

Mill’s believed that true freedom would prevail only when an individuals’ drive to better his/her station could proceed without impeding others in their own efforts to do the same. This clearly-expressed belief has formed the basis for our free enterprise system.

Chicagonomics: The Evolution of Chicago Free Market Economics by Lanny Ebstein

The University of Chicago, founded by John D. Rockerfeller, and its leading economist, Milton Friedman, are principal purveyors of laissez-faire capitalism as practiced today.

Capital in the Twenty-First Century by Thomas Picketty

The classic work on inequality by the Frenchman who discovered inequality. A Harvard University Press best-seller, highly readable.

Inequality: What Can Be Done? By Anthony B. Atkinson

A very difficult read but I believe he has the answer; so be patient and read it. Atkinson, a Britisher, is one of the leading authorities on inequality.

The Price of Inequality: How Today’s Divided Society Endangers Our Future by Joseph E. Stiglitz

A highly readable exposition of our plight.

Saving Capitalism for the Many, Not the Few by Robert B. Reich

A myth-shattering breakdown of how the economic system that helped make America strong is now failing us and what it will take to fix it. Reich sees hope for reversing our slide toward inequality and diminished opportunity when we shore up the countervailing power of everyone else.

Listen, Liberal: Or, What Ever Happened to the Party of the People? by Robert Frank

The professional class, the teachers, lawyers, doctors, architects, etc., on whom our country has counted for so long to remain objective, above the political fray, and steer our democracy over the shoals of greed and corruption and self-interest, has lost its objectivity, no longer associates itself with the working class, the labor unions, the unlucky, and has joined the rarified ranks of the well-educated and the privileged.

Five short articles in the Jan/Feb Issue of Foreign Affairs:                                                                   

Inequality and Modernization by Ronald Inglehart

Inequality and Globalization: How the Rich Get Richer as the Poor Catch Up by François Bourguignon

How To Create a Society of Equals: Overcoming Today’s Crisis of Inequality by Pierre Rosanvallon

Equality and American Democracy : Why Politics Trumps Economics by Danielle Alle

How to Spread the Wealth : Practical Policies for Reducing Inequality by Anthony B. Atkinson

The Role of Technology in Income Inequality

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Rise of the Robots:Technology and the Threat of a Jobless Future by Martin Short

Winner of Business Book of the Year in 2015, this spell-binding book looks into our not-so-distant future to predict that human capacities at all levels will eventually be replaced machine intelligence, leaving both workers and managers with nothing to do, no jobs. He explores some possible solutions if we act at once.

 

 Books About Quakers in Business

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Meeting House and Counting House; The Quaker Merchants of Colonial Philadelphia 1682 – 1763 by Frederick B. Tolles

Almost since the beginning Quakers, in both Britain and America, became successful businessmen, a tradition that descends almost to the present, and hence qualifies them to be leaders in the necessary reform of present harmful and malicious practices.

Good Business Ethics at Work: advices and Queries on Personal Standards of Conduct at Work

Today many people are dismayed by unethical business practices they see around them. They believe that business itself is unethical. This book is to act as a guide and an inspiration a business for the benefit of all stakeholders.

Quakers Living in the Lion’s Mouth: The Society of Friends in Northern Virginia 1730 – 1865 by A. Glen Crothers

The difficulties of a group of Quakers to accommodate themselves to a slave-owning society, as an example to today’s Quakers attempting to survive the injustices of an abhorrent economic system.

The Clash of Cultures: Investment vs. Speculation by John C. Bogle

Jack Bogle is a very successful business man. He is not a Quaker but he conducts his business with all the conscientiousness we would expect of one. He is a model for all that we would hope a business man to be and we should listen carefully to his argument for the ethical conduct of business.

To the Peace and Social Action Committee

First I would like to thank the committee, in particular Brian and Ann, for pointing out to me at one of our earlier meetings how as a committee we could arrive at unity on this issue of where to place our efforts for peace and social action. I subscribe to this. Patience and listening are what is required, and I fully intend to adhere to these.

I don’t, however, believe that this precludes my laying all my cards on the table from the start. I wish to be clear where I stand on these issues

I feel we have been going about this piecemeal.

Let me explain: it is as if in 1850 some member felt strongly that the meeting needed to protest the breaking up of slave families for its inhumanity while another member voiced his concern over the brutal corporal punishment that slaves were subject to. Better still, a third says, to oppose the overloading of slave ships with its inevitable consequence: the death of half the cargo.

Now each of these is a worthy cause but are they not merely symptomatic of the real evil slavery? It is slavery that is intolerable and that they must go after. In our case, in 2015, it is poverty that is the endemic evil that we should declare our opposition to, just as have the Pope and the President. Anyone following the newspapers and the public polling knows that the single issue that most concerns the American people (60%) and that will be the central concern of the 2016 election is the growing inequality of incomes in this country that threatens our democracy. Poverty is not an inevitable condition of capitalism. There was a period right after the Second World War that lasted well to the mid 1980s when the disparity of incomes in this country was at a tolerable level. Subsequently, the weakening of labor unions, globalization, and the loosening of restrictions on business practice and the accumulation of capital has reversed the good direction in which we were going and brought our economy to an alarming level of inequality with the consequent effect of increasing poverty.

What has been done can be undone, with sufficient good will and persistence. And we Quakers are in a strong position to do it . Prevented from going to university and into the professions because of their refusal to swear oaths, 19th--century Quakers became tradesmen. There is a solid tradition of successful and highly trustworthy business men and women among us: e.g. Barclay’s Bank, Bethlehem Steel, Cadbury Chocolate, Carr’s Biscuits, Huntley and Palmer, John Hopkins University, Lloyd’s Bank, Strawbridge & Clothier department store, Waterford Crystal; the list goes on. We are an integral part of the capitalist system and, being in the middle of it, neither too rich nor too poor, ideally located to point out its faults and their corrections. The Episcopal Church in which I was raised is too closely associated with the moneyed class in this country to be useful; the Catholic Church too embedded among the poor to be credible or objective (although the present Pope seems determined to make a go of it). I am asking that we shoulder the entire issue of poverty in this country as our burden, with all its concomitant evils, which should subsume many or most of the concerns of our membership. It is a disgrace, easily comparable to slavery, that must be stamped out through reducing income disparity to a tolerable level. Why not investigate how this can be done, make it our cause?

I would propose that, as a committee, we take a little time to examine the condition of inequality of wealth in America today, its root causes and what can be done about it, under the following headings:

  1. The Rich, the Super Rich and the Extent of the Disparity
  2. Poverty in America: The Disgrace and Hopelessness of Being Poor
  3. Has it Always Been Like This and Can Anything Be Done about It?
  4. Why Should We Quakers Particularly Concern Ourselves?

I would be prepared to talk on each of these topics for about twenty minutes, to be spread among as many of our regular meetings as you care to assign me.

For those who are curious about how one might go about reducing the inequality between rich and poor, I recommend the books I am currently reading (see the Annotated Bibliography above).