‘Merit' is a sham — paths that used to be available for the middle class have become blocked, and the gap between the one per cent and the rest is ever-widening
In 1973 a 23-year-old copywriter, Ilon Specht, was sitting in a meeting at McCann Erickson in New York, in which her colleagues were discussing a television commercial for L’Oréal’s new hair colour, Preference. Angry at the portrayal of women as objects, she banged out a script featuring a self-confident woman walking towards the camera explaining why she was buying the most expensive hair colour in the world. The punch-line: “Because I’m worth it.”
That slogan is still used by L’Oréal today, modified into “Because you’re worth it” and more recently “Because we’re worth it”. But what began as a feminist statement has acquired a much wider resonance. The idea of a bonus was rare in the 1970s. People tried to do their jobs well because that was what they were employed to do. Now the bonus culture has swept across the developed world, and far beyond commerce and finance. Even university vice-chancellors and hospital managers in the UK expect bonuses, and they expect them because they feel they are worth it.
A similar shift has taken place with the concept of meritocracy. The word was coined by Michael Young, later Lord Young of Dartington, in The Rise of the Meritocracy, published in 1958. Young much regretted that his vision of a highly-educated, intelligent elite ruling over, and separated from, an underclass of less “merited” people, became twisted into a justification for this new class system, with his word losing its negative connotations. Dig even shallowly into political debates on both sides of the Atlantic and you find people suggesting that the views of highly educated people should somehow count for more than those of the less well-educated. A reaction against that is hardly surprising. In the sense that populism is push-back against the political elite, it is an attack on Young’s vision (or nightmare).
In The Meritocracy Trap, Daniel Markovits, a professor at Yale Law School, is more concerned by the way in which a noble aspiration has become corrupted in US financial outcomes rather than in its political system. He opens with the proposition that “merit is a sham”. It does not operate as it is supposed to, creating a genuine equality of opportunity, because paths that used to be available for the middle class to better education have become blocked. It harms the young elite who are able to forge through, because of the financial burden of the education system on their families and themselves, and because of the grinding workload imposed by top jobs. And it has created tension and resentment between the elite and the middle class.
“Merit,” he writes, “has become a counterfeit virtue, a false idol . . . A caste order that breeds rancour and division. A new aristocracy, even.”
What’s gone wrong? His subject is the United States. He documents the contrast between normal middle-class life in a Detroit suburb with that of the relentless competition of high-achieving families in New York, Boston and San Francisco, where rich parents compete to get their children into top kindergartens at the age of four. Competition continues through education and into work, with young investment bankers putting in 80 to 120 hours a week. He argues that innovation now favours skills, whereas a generation or more ago it enabled unskilled and semi-skilled factory workers to earn a good living. Now manufacturing has been hollowed out.
The gap between the one per cent and the rest is further widened by their different social habits. The rich marry each other, rather than mixing across class and income level—assortative mating—and they are more likely to stay together. That supports their position on the wealth ladder.
And so on. This is a portrait of American society that everyone will recognise, and Markovits sketches it persuasively. More telling, though, than any pile of data is his description of the similarities in the upbringing of Bill Clinton and George W. Bush. Though Clinton came from a much more modest background, scholarships enabled him to go to Oxford and Yale. Though the Bushes were rich, George W. was brought up in a modest house in a similar middle-class neighbourhood to Clinton. Both Laura Bush and Hilary Clinton wore off-the-peg dresses at their weddings. Then the rich lived similar lives to the middle-class. Now they don’t: Chelsea Clinton’s flat in Manhattan cost $10m.
So what’s to be done? Here he falters. He is a lawyer. He spends some 290 pages building the case for the prosecution and a compelling case it is. But he leaves just 16 pages for solutions. He offers two paths to reverse inequality. One is to widen access to good education. The other is that work “must return mid-skilled labour to the centre of economic production”.
Few would quarrel with the first, though how to do it is difficult. The second is more problematical. Yes, as he suggests, the government could increase taxes on the highly-paid and cut them for middle-income earners. And it could give wage subsidies for firms taking on more middle-income workers. But would that really do much to change the structure of the US labour market?
A further issue is that inequality is seen entirely through a US prism, though there is a postscript for the UK edition. He treats rising inequality in the US as though its economy were a closed market. He ignores the impact of globalisation and the growth of the middle class of the emerging world, many of whom directly or indirectly are competing for US jobs. He ignores the fact that manufacturing has declined and jobs have shifted to service industries across the entire developed world. The great paradox of our age is that the huge decline in inequality between countries has happened alongside the relatively modest increase within them.
Of course there are great inefficiencies and inequities in the US and it is right to highlight those failures. But the US is still the world’s frontier economy, driving forward the communications revolution, inventing the idea of social media and disrupting traditional industries including shopping, taxis and motor cars. That drive comes from its elite.
So why do so many of America’s elite work so hard? Of course they enjoy the money they earn, but also the status hard work brings. Working hard makes them feel they are worth it. The trouble—and America has to confront this—is that often they are not.