The New Managerial Class Is Not a Class at All

Bryan G/Downtown Brooklyn, New York

Class analysis as a method of understanding politics and the state is one of the oldest traditions in political theory; it is dated at least to ancient Greece, with Aristotle’s The Politics being one of the first formalizations. It holds great explanatory power throughout history, and its classic divisions—of demos, slaves, and oligarchs—are reinterpreted as needed in every age, just as every generation must find new ways to express the plays of Shakespeare in the context of their living world.

This reinterpretation can fall into two camps: analysis that exists in relationship to the contemporary realm of debate and ideas, or an analysis which exists in relationship to the historical and economic facts. Since talking about ideas is more natural and cheaper for media outlets, these analyses tend to dominate. Even the nature and interests of classes are transmuted into the realm of ideas.

This brings us to the debate about the New Class, also known as the professional and managerial class. To the populist right, the rhetorical purpose of the New Class is to identify an economic base for globalism and the liberal elite. To the populist left, it is the supposed economic basis for neoliberal technocracy. The theory has seen four major waves in its history: first in anarchist critiques of Marxism, then in Trotskyist analysis of the USSR, before being picked up by neoconservatives and socialist critics of the New Left. In the past five years, it has finally experienced a revival among populists of all stripes.

This should come as no surprise; the culture of educated professionals is highly visible in our elite institutions. These people are the Beltway thinkers, the punditry, the liberal intelligentsia, the libertarian think-tankers, the Brooklyn podcasters, the business school frat bro executives, the NGO lobbyists, the heads of corporate HR, the New York Times columnists, and the San Francisco start-up financiers. They are an amorphous mix of everything ordinary people are supposed to despise about how our system works. What they have in common, besides participating in elite institutions, is simple: they are college-educated and engaged in intellectual labor.

But while their cultural impact is salient and distinct, the question whether they actually constitute their own economic class is often overlooked. This leaves the analysis fundamentally incomplete. If the New Class is in fact a distinct economic entity, then any current set of ideas surrounding it is, to some extent, merely a reflection of its current interests. In order to not be fooled by changing circumstances, we would have to understand the enduring basis of its power. On the other hand, what if it has no basis in economic reality at all? In that case, we would be dealing with a cultural phenomenon which needs explaining. If the New Class only exists in the realm of ideas, then it is something of a spook. It might reflect a real identity or a cultural dynamic, but the real power structure beneath all this is something else entirely.

What are the fundamental attributes of class? To fit educated professionals into the larger social theories of economic classes, they need two major characteristics: a unique stream of income and a distinct class ideology. The first is necessary to establish them as an economic class, the second to understand them as a political actor.

In terms of income, there are the typical forms: wages, salaries, and investment income through stock options or 401Ks. The higher one traverses the ladder of corporate professionals, the more monetary incentives there are to align one’s interest with shareholders. At the very top, they are indistinguishable from the capitalist class. But this class, as popularly conceived, includes all fields of white collar knowledge work, such as fee-earning lawyers and doctors, tax-funded bureaucrats, and tenured professors.

Most of these positions could just as easily be placed into traditional economic categories of working class and petite bourgeoise—that latter group being small business owners, managers, and professionals like lawyers. But critics who uphold the New Class status of these professionals and managers instead focus on the type of work done, rather than the form of income. Right-populists today point towards the professional managerial class’ role in coordinating production in a way that undermines the roles of capitalists and capital markets.

However, this is not a new idea. Adam Smith and Karl Marx both foresaw the same managerial revolution with the emergence of joint-stock companies. In fact, the pinnacle of this administration seems to have come in the 1950s, rather than today. During this period in industrial capitalist economies, the corporate bureaucracy ran the show as a member of a triumvirate with unions and government. After the dominance of neoliberalism and the Chicago school of economics from the 1970s onward, corporate government and capital markets alike underwent numerous changes at the hands of Congress and corporate raiders to ensure the sanctity of shareholder value above all else. Hostile takeover bids, private equity, and tying executive pay to share price were all part of a process designed to overcome the principal-agent problems between the corporation and its owners.

While corporate executives were instrumental in off-shoring jobs and globalizing supply chains, big investors were also key. They flooded money into the Japanese, South Korean, and Chinese capital markets and pressured corporations to deliver growth. Indeed, the most administratively advanced companies are those not controlled by professionals at the top, but which have powerful owners exercising direct control: Jeff Bezos for Amazon and the Walton family for Walmart.

In contrast to a conspiratorial fear of the New Class as a new ruling elite, the populist left identifies the professional managerial class not with its management of capital, but of people. Like the right, this method of identifying the New Class with its work is done to separate it from groups such as nurses and teachers, who generally command more sympathy and whose work could be seen as a necessity in a way that a lawyer’s is not. Amber Lee Frost stands in contrast to her more academic forebears when she presents the most articulated version of the populist left attack on the managerial class, identifying them with the same paternalism of an HR department. Barbara and John Ehrenriech, two examples of these forebears, instead define this class precisely on its social status as a class of professionals.

This focus on professionalization as justification for a truly new class also has its drawbacks, particularly when looking back on the history of professionalization itself. Professionalization as a process was born from the secularization of scholarship and the emergence of liberal universities as the place of training for professionals. This process was key in breaking down the barriers of feudalism which restricted clerical work to the church and work in the state bureaucracy and military officer corps to the aristocracy. In this way, professionalization was a central part of the struggle of the bourgeoisie against the old order. Indeed, early professionals like lawyers were instrumental in bourgeois revolutions like the American and French Revolutions.

Previous interpretations of this theory focus on the monopoly of knowledge bestowed upon this class, focusing on scientific knowledge in the 19th century up until the 1950s, and then on cultural capital after the 1960s. It is true that these are intellectual workers, doing specialized intellectual labor. But then, all human labor requires intellectual work—thinking abstractly about a task and its challenges. What makes educated professionals unique is their training in fitting their task into more abstract theoretical formulations and modifying those theories in turn. They are trained in the methods which society uses to reproduce both scientific knowledge and ideology.

This distinction between scientific knowledge and ideology is a slippery one, even in the most academically rigorous fields. Unsettled debates often mean wide-ranging ideological interpretations until new evidence can be pointed to for clarification.

Marx, in his critiques of the philosophers of his time, identified the work of intellectuals as the ideological defense of the current state of affairs and its ruling class. But, to take a more neutral view of the historical role of intellectuals, it’s clear that all classes in society rely on intellectuals for the production of ideology. In ancient Athens, the learned rhetoricians were just as much the ideologues of the demos as the oligarchs. The universities of Europe which produced the greatest defenders of liberalism in the 19th century also produced its revolutionaries. This is why theories of the New Class often struggle in articulating the distinct ideology of this class. Emphasis on the rationalization of production, maximizing efficiency, and technocratic management are not so different from the ideological traditions of early utopian republicans via the perfection of the law. We may even consider West Coast futurism as the logical end point of Adam Smith’s analysis of the division of labor increasing efficiency.

There have been attempts to make this distinction more empirical by conceptualizing intellectual labor as profit-maximizing labor. But a better formulation might be “surplus-maximizing labor”; most of these workers still see their income come via wages and salaries, incentives which put them in an adversarial relationship with profits. Thus, while the high level executive will push for anything to boost stock prices, the analyst, accountant, and engineer underneath them might feel contrary. Surplus refers here to a broader category than profits; it includes all income generated above the wages of workers directly engaged in production and the cost of other inputs. We have empirical data showing that from the 1980s to 2000, the rate of profit remained mostly flat almost entirely due to the pressure of rising wages for supervisory labor, that is, “management.” 

Ironically, these intensely critical New Class theories have tended to be the only attempts educated professionals have made to be conscious of themselves as a class. It has not produced any form of collective ideology which educated professionals identify with; Frost admits as much but nonetheless wishes to preserve the status of this group as a class. This presents a crucial problem for applying class analysis to this group: the ideology they produce is for the defense of existing classes in society, not themselves. This is what both Frost and Ehrenriech refer to when they speak about the “opportunism” of this supposed class.

The two authors draw rival conclusions, writing as intellectuals of the working class. Frost suggests that the professional managerial class cannot be trusted due to its self-interest in management, while Ehrenriech believes educated professionals are beginning to side with workers and a more egalitarian society as the benefits of meritocratic capitalism have started to break down. There is some evidence for this. Up until the 1990s, college graduates had much higher wage growth than normal workers. This higher rate of growth began to slow before stopping completely after the 2008 financial crisis. The Great Recession was also a turning point that instigated a renewed interest in working class politics by these intellectuals, a trend which was super-charged by Bernie Sanders’ 2015 presidential campaign, and which Frost herself is a part of.

Frost finds herself incapable of coming up with a structural explanation for why any members of this class, like Ehrenriech, would take the side of the workers, since she has enclosed such academics into their own self-interested class with corporate executives and managers. And yet, the Democratic Socialists of America (DSA), an organization  full of educated professionals suddenly very interested in working class struggle, demands such a structural explanation.

The theoretical background of the New Class hypothesis, which is shared by a number of similar democratic socialists and left-wing populists, helps to explain these limits of imagination. Whereas 19th century anarchists feared the rule of intellectuals, what is ingrained in the memory of contemporary leftists is the failures of the New Left in the 20th century. This is a narrative about radical organizations abandoning class politics over cynicism towards labor movement and instead embracing identity-based movements. In the realm of academic radicalism, the language of Marxism was slowly phased out in favor of post-structuralism.

One of the most identifiable characters in this transition was Herbert Marcuse, sometimes called “the father of the New Left.” The German-American theorist worked for the precursor to the CIA during the ‘40s and was associated with the Frankfurt School of critical theory. He critiqued the unfreedom he saw at the heart of American social democracy and Soviet communism while rejecting theories of class struggle. In his time, Marcuse was one of the most well-regarded academics and found his home in a number of elite institutions such as Columbia, Harvard, and UC San Diego. Many members of the New Left would go on to be incorporated into elite institutions themselves.

Contemporary socialists would critique the New Left, both for careerism and their penchant for taking on radical ideologies like fashions. Seemingly unmoored from any material tendency or economic class, the New Left destroyed itself and cleared the way for neoliberalism by taking on absurd positions and insular organizational practices. But this leaves a similar difficulty for structuralist theory as Frost mentioned before, a difficulty she seemingly solves only by asserting this radicalism as the result of unique class interests.

Perhaps it is better to turn the problem around if we want to understand it in a structural way. Why does our political and economic system permit, and even encourage, such radicalism in these institutions? Why not simply make universities the site of pure propaganda and indoctrination designed to defend the status quo?

One important feature of a fully developed capitalist economy is its tendency for disruption. Competition demands that our methods of production, our ways of working, and the technologies we employ, be constantly revolutionized in order to make greater profits and edge out competitors. The business cycle and its periodic crises ensure that our frameworks for regulating and understanding the economy shifts under our feet every few decades. What happens when the world that the ideological guardians of the current state of affairs have spent so much effort defending is no longer recognizable? Theories which justify the existing world necessarily come into conflict with a dynamic material reality that is indifferent to them.

Radical critique of the existing order, then, has a special place. Consider the immeasurable value that Keynes’s General Theory provided to capitalism by transforming the material critique of the Great Depression against capitalism itself into the theoretical critique of neo-classical economics. Now, imagine the tremendous opportunity presented here for universities: by training their students in radical critique, their alumni become the ideological representatives of the elites who revolutionize production and write the new regulatory frameworks. With representation in the upcoming elites comes further money and prestige, an investment for the future—assuming, of course, that this radical critique doesn’t undermine these same elite institutions. In this way, radicalism is institutionalized just as much as orthodoxy.

The original problem of the New Class—that is, for the anarchists and Trotskyists who first drew attention to it—was how to critique a state that was not controlled by the capitalist class. Over time, the object of critique moved from the state to ideology: the question became what class was behind the empty radicalism of the liberal elites and the New Left. Rather than paying attention to power structures, thinkers began to focus on the discourse and ideas they generated.

But these are not such very different things. Recall the history of professionalization which made secular, liberal education what it is today. This process is the very same one which opened up the state bureaucracy and military officer corps to meritocratic selection, as opposed to relying on aristocratic privilege. The state and these institutions have overlapping roles in generating legitimacy for the political and economic system we live in, and this generation of legitimacy requires intellectual labor. So, we get the cycle of raising the new intellectuals who work to critique the world of today to justify the world of tomorrow.

For today, however, educated professionals remain a cross-cutting group representing all of the major economic classes in our society, increasingly so the proletariat. Their cultural pathologies and highly visible role in crafting ideology make them an easy target, but they have no structural autonomy or agency—so far, anyway. Classes are not eternal categories of our universe; they are historically contingent and the result of  complicated processes. It is possible to imagine we are living through the pre-history of the professional and managerial class. Something genuinely new might come about if educated professionals and intellectuals find a unique way to benefit from their position and begin to structure society according to their own logic. There are already signs that this kind of reimagining is ongoing. Why were young educated professionals so firmly behind Bernie Sanders’ presidential campaigns? Besides reaping the outputs of universal government programs, it may be worth it to think where these professionals might find themselves in a Sanders regime—with comfortable government jobs in the newly nationalized industries and welfare administrations.

The consequences of this analysis for our contemporary politics is simple. The extent to which the cultural divisiveness and material incentives of capitalism keep educated professionals from forming a cohesive whole is the extent to which they are not a class; the right and left populists will be proven correct. However, to the extent to which they do become a political agent for themselves, they make possible a new world, and a new kind of political and economic governance, the contours of which are currently unimaginable even to those who desperately search for a horizon beyond our present reality.

Nicolas Villarreal works as an analyst for a government contractor and finance and formerly worked in federal banking regulation. He is a graduate of the College of William and Mary, and author of the novel Caeruleus.