The Class Arithmetic

Time to jump ship?

It took years after the shock of 2016 for Democrats to confront the fact that the GOP had taken over the mantle of the working-class party. Many still refuse to face the facts. First, the empirical pattern of class-partisan realignment was treated as incredulous. Then, once the pattern was conceded to be robust, it was blamed on a presumably racially-resentful white working class (always a handy stereotype in elite discourse). Finally, as working-class “people of color,” above all, Hispanics, began to abandon the elite party for the party of the working class, panic has broken out in the ranks.

It has become increasingly clear that the GOP, not the Democrats, is destined, by class arithmetic, not racial demography, to emerge as the hegemonic party of the 2020s; if indeed not beyond. The changing class composition of their coalitions is transforming both parties. Democrats are increasingly unable to contain the ideological excesses of professional class Millennials — Democrats to the last man. The GOP, on the other hand, has comprehensively failed to contain the working class revolt. The future of American democracy hangs in the balance.

After a brief review of the electoral patterns over the past few presidential cycles, we’ll try to map the shifting GOP coalition. For the statistical analysis, we obtain county-level presidential vote shares from MIT Election Lab for 2000-2020. We compute change in GOP vote share to control for entrenched partisanship which confounds the vote share levels. We then adjust change in GOP vote share for national trends by deducting the population-weighted means of change in GOP vote share by election cycle. In order to extract socioeconomic information from the cross-section, we then compute Spearman’s correlation coefficients for a number of features.

Table 1 displays our estimates. The following heatmap shows the same in graphical form. The most significant correlate is the college graduation rate, a good summary measure of the class composition of a county. The correlation coefficient for the college graduation rate was roughly -0.3 in 2004 and 2008, fell to -0.1 in 2012, before rising to -0.5 in 2016. In 2020, it tempered, but the hemorrhaging continued: r = -0.2. The same pattern, but more attenuated, is visible in the coefficient of per capita income. This is the basic pattern of fluctuating but secular class-partisan realignment with first-order effects for party competition in the United States.

The coefficient of population and population growth shows that the GOP coalition has become more rural over the past decade. The 2016 cycle marked a major shift. It was the only year for which population growth, net migration, and net international migration were significantly correlated with the adjusted change in GOP vote share. Finally, the coefficients for overdose death rates and suicide rates share the same pattern: significantly positive for 2004-2016 and insignificant for 2020. This suggests that Biden was able temper some of the anger in “flyover country” over deteriorating social conditions.

At the heart of the emerging GOP coalition is the working class — people without college degrees and modest incomes who live in places that have few foreigners, that are losing people to the elite-dominated cities, and where social conditions have deteriorated most markedly. This is now the mass electoral base of the party. But a political party is always a collaboration between elites and masses. I’ll paint a broad-brush picture of the GOP coalition as it exists today and, more importantly, its transformation under pressure “from below.” Seen in this light, elites-only models — “the party decides,” “elite overproduction,” “the investment theory of party competition” — are revealed to be missing the forest for the trees. Mass working class politics is dramatically changing the GOP. Any model that does not pay attention to class politics can be summarily thrown out.

At the heart of the GOP’s coalition of elite interests is what we may call the deregulators. These are largely business interests whose main beef is with the regulatory-administrative state. This is not libertarian ideology — although libertarians are largely sympathetic. This is pure business interest. They just want the damn regulators off their backs. This is the hegemonic bloc of the GOP. There is no appetite among GOP donors for any expansion of regulations. If you have any such ideas, you’re not welcome within the GOP. Firms that are open to some regulation live in the Democratic party; firms that are opposed live in the GOP. This is largely a question of the nature of the industry — roughly, the “E” in ESG. Dirty industries — above all, oil and mining interests — are a natural GOP constituency, just as globally-oriented banks and tech firms with low national environmental footprint are natural Democrats.

Although it is more pronounced in the GOP, resistance to tax hikes is universal among firms. For instance, President Biden’s ambitious legislative agenda was killed by corporate democrats opposed to any hikes in corporate taxes. The diagnostic feature of corporate GOP is not taxation but deregulation. In that sense, this is still very much the party of Reagan.

The second mainstay of the GOP are the traditionalists. Think evangelicals, anti-abortion ideologues etc. Since their ideological convictions are totally incongruent with professional class ideology, they’re essentially captive GOP voters who have no electoral choice. The only impact of this bloc comes from motivation and turnout. For instance, the Court’s decision on Roe v. Wade is likely to generate enthusiasm and turnout in this bloc, just as much as among pro-abortion liberals.

These mainstays of the GOP coalition — the deregulators and the traditionalists — provide continuity amidst change. The real action is elsewhere. The GOP is now caught in an all-out war between free traders and economic nationalists. The free traders — “Rocky Balboa” — were the heart of the neoliberal coalition in both parties. In both, they’ve lost ground to economic nationalists.

Economic nationalists are not a new feature of the American political landscape. Indeed, the GOP was created by Midwestern industrial interests to take on the coalition of New England mercantile interests and Southern planters who favored free trade with Britain. Their main goal was less to free the slaves and more to build a great tariff wall. This tariff wall, the tallest in the world, survived into midcentury; only eroding slowly as globally-oriented banks and multinational firms drove global economic disarmament. The high point of the free traders’ influence was the Clinton presidency, that presided over Nafta and China’s admission in the World Trade Organization.

While the tide has turned against the free traders on account of the rise of China in both parties, this process is more pronounced in the GOP. This is because the globally-oriented business interests who bankroll the Democrats exercise a veto against a rollback of globalization, while the domestically-oriented business interests who bankroll the GOP are, at worst, indifferent.

The war is being fought, as usual, by a shifting coalition of political entrepreneurs and intellectuals-for-hire, both on the payroll of business interests. For instance, Peter Thiel and Robert Mercer have bankrolled the Ohio senate campaign of J. D. Vance, one of the leading figures of the new economic nationalism.

Because of redundancy in check writers — there are six hundred billionaires in America and many thousands of loaded firms — the struggle over economic policy is where the changing class coalition meets elite politics. In this Republican game, the working class emerges as a kingmaker. For it is precisely the working class sympathy for economic nationalism that has shuffled the deck. Indeed, the economic nationalists see their protectionist formula as a solution to the crisis of the working class. The idea is that working class fortunes can be restored by the traditional American medicine of protectionism and corporate welfare.

The basic prognosis is clear. Because of changing class arithmetic and because the traditionalists and deregulators have no dog in the fight, the economic nationalists now have the upper hand in the struggle over GOP policy. China is not going anywhere and working class anger is very far from getting tempered. So this process is unlikely to go into reverse any time soon. Before long, we expect the GOP to emerge as the party of economic nationalism.

At first sight, the GOP has embraced denialism on global heating. But the real agenda is militarized adaptationism. Ie, we’re going to build an impenetrable border to the south to prevent climate refugees from escaping the heat and instability in Central America by moving north. And we’ll harden our institutions to deal with the direct effects of global heating — sea walls, air conditioning, etc. But is militarized adaptationism really consistent with the emerging GOP coalition? There are three reasons to think not.

The first is that, since economic nationalism is unlikely to relieve working class stress, some kind of investment-jobs programme will increasingly become necessary. The best available option is and will remain investing in the energy transition; especially because red states are likely to benefit the most.

Second, clean energy technology is emerging as the central arena of geoeconomic competition. Can America really be first if China is making all the solar panels for the world? So, a logic intrinsic to economic nationalism will drive a reversal in GOP climate policy.

Third, and finally, the main blockage towards rational climate policy is the power of the oil interests. They’re unlikely to bend. But balancing them, within the GOP coalition, are the mining and perhaps some clean energy interests (committed deregulators who are invested in clean tech). The demand for metals and materials of the energy transition are so large that, eventually, the size of their checkbooks will rival those of the oil interests.

If I am right about this dynamic — and the case is certainly not open-and-shut — the GOP will eventually develop a more or less coherent agenda. Professional class expertise, that largely abandoned the GOP under Trump, will then migrate back, first in a trickle and then in a flood. Ironically, the GOP will therefore achieve the professional class-working class coalition so desperately desired by Bernie Sanders.

The transformation of the GOP under the tectonic forces of class politics is an event of some historical significance. It is possible to see the emergence of a new party system dominated by the GOP. A lot is riding on the outcome of the war over GOP policy. Economic nationalism could easily get coupled to chauvinism. In that scenario, the US will become more like Modi’s India. The oil interests could hold the line, ensuring that clean energy and affiliated interests all end up in the Democratic coalition — and locked out of power. If that happens, militarized adaptationism will become US climate policy.

The outcomes of the struggles over the policy agenda of the GOP are far from certain. What is certain is that this is a necessarily open-ended process that will be determined by the balance of forces. Interested outside parties may be able to intervene productively. Indeed, turncoat Democrats could very well tip the balance. Given the dearth of professional class expertise in the GOP, turncoat professionals could make a crucial difference. And the earlier they shift their party allegiance, the more likely they are to make a difference.

The upshot is that the Democrats are cooked. The future of the American polity will be decided in the GOP. If you’re a professional class expert who hopes to make a difference, you may want to hold your nose and jump ship at this point.