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Boiling Point: Democrats, Republicans, and the Decline of Middle-Class Prosperity.

Letting his ego out for a trot, Kevin Phillips begins Boiling Point by observing that during last year's presidential campaign, Bill Clinton, Ross Perot, Pat Buchanan, Tom Harkin, Mario Cuomo, Jerry Brown, Lloyd Bentsen, Douglas Wilder, and Dick Gephardt all demonstrated that they had either read his last book, The Politics of Rich and Poor, "or drawn on its theses." On the other hand, "George Bush and his political advisers chose to ignore the book." Is it any accident that they're unemployed today? But the further implication--woe betide the president who ignores Kevin Phillips--is superfluous, because we now have, for perhaps the first time in our history, a president who can absolutely be counted on to read and assimilate the message of any new book on public affairs that gets even a fraction of the attention that is sure to come to Boiling Point. It's inconceivable that President Clinton won't be influenced by this book--which may not be good news.

Nearly everybody in the politics business agrees with Phillips that he deserves to be treated as an oracle. His status is well-earned. As a statistics-wielding young staff member on the 1968 Nixon presidential campaign, and shortly thereafter as the author of The Emerging Republican Majority, Phillips identified the most powerful force in national politics during the past quarter-century: Middle-class populism. As opposed to the People's Party populism of the late 19th century, or Huey Longism during the Depression, middle-class populism is not headquartered among the poor and dispossessed, and therefore it can go either way politically. During times of economic prosperity, such as the late sixties, the middle class could be persuaded to direct its resentment toward a cultural elite made up of intellectuals and bureaucrats who sneered at patriotism and other mainstream values and had empathy only for themselves and the minority poor. During times of relative cultural stability and economic trouble, such as the late eighties and early nineties, the middle class would switch to resenting the rich. (That's why Dan Quayle's sallies against the cultural elite didn't work in 1992.)

Thus, depending on its mood, the middle class might vote either Democratic or Republican--the only constant being the enormous potency of the resentment-of-the-elite theme. It was an important bellwether when Phillips, who seems to have a mystical, instinctive oneness with the middle class, announced a switch in his own resentments from cultural to economic in 1990 with the publication of The Politics of Rich and Poor.

If you take what Phillips says as indicative of the political mood, the big news about Boiling Point is that the middle-class anger of The Politics of Rich and Poor, and of the 1992 campaign, was just a warm-up; now Phillips and the middle class are getting really angry. It must be said that two weeks into the Clinton administration, Phillips seemed to be right on the money. Already there have been two controversies (over Zoe Baird's child care and gays in the military) that revealed the depth of the heartland's simmering rage over the values, lifestyle, and prosperity of the elite, and in both cases Clinton, even though he has spent the last year communing full-time with the people, seemed to have been blindsided by their reaction. Phillips spent the month of January issuing dire warnings that if Clinton included a lot of new taxes on the middle class in his economic plan, all hell could break loose. The wave that swept Bill Clinton into office, in other words, and that he may have hoped would quickly dissipate, may instead continue to gather force all through his term as president.

Tax and offend

The bulk of Boiling Point is made up of a long, detailed complaint about the economic condition of the middle class. Phillips does not operate in the manner of a disinterested social scientist testing a hypothesis; rather, he has gathered under one roof what must be every recent study and article that supports his point. The result of this relentless procession of grim news (delivered in Phillips's relentlessly dense and prosecutorial prose) is that you finish Boiling Point feeling as if you've been hit over the head with a sledgehammer. Everybody (except perhaps the editorial page of The Wall Street Journal) now agrees that in recent years growth in family income has stagnated, that the share of national wealth going to the rich has increased, and that one-parent families and the less educated have been hit the hardest. Phillips gives this situation the emotional freight of the Great Depression.

Tax policy lies at the center of his case. Phillips correctly points out that the net result of the three major pieces of tax legislation of the eighties--the 1981 supply-side income tax cut, the 1983 "rescue" of the Social Security system, and the 1986 simplification of the federal tax code--was that taxes on the rich declined substantially while taxes on the middle class rose. The loss in government revenue caused by the 1981 law was partially offset by increases in other taxes that are more regressive than the federal income tax. They included state and local taxes, user fees, and, most notoriously, the Social Security tax, whose maximum individual assessment rose by 150 percent during the eighties. The increase in the federal deficit also helped the rich, because the government's interest payments are essentially a subsidy to wealthy bondholders. Back in the conservative fifties, Phillips says, median-income families paid less than 10 percent of their earnings to the federal government, but "one profile of Charles Wilson, the chairman of General Motors, estimated that he would have kept only $164,000 from a 1950 salary of $626,000." The top federal income tax rate was 91 percent until 1964; today, it is 31 percent.

Meanwhile, what the middle class gets back from the government has diminished. Such essential services as public education, police, parks, and libraries have suffered severe cutbacks, especially during the recession that's just now ending. Private employers have reduced pensions, health benefits, and, most importantly, the basic security of a job. Inflation and unemployment, Phillips claims, are actually much higher than the official government statistics say they are. The cost of higher education is skyrocketing. A few scattered quotations from Boiling Point will convey the overall gestalt: "Much of the great American middle class was losing ground--and knew it"; "Downward mobility was everywhere"; and, "in less than a generation, the average American went from being a political icon to being a fiscal milch cow."

Phillips has obviously been much influenced by Paul Kennedy's book The Rise and Fall of the Great Powers, and he places the woes of the middle class in a similar world-historical context of national decline. Phillips appropriates Kennedy's technique of looking for repetitive patterns in the past woes of such countries as Spain and England. But, whereas for Kennedy the key problem was "imperial overstretch," for Phillips it is the excessive prosperity of the rich at the expense of the middle class. National heydays, he says, are always bourgeois in character and always involve a manufacturing-based economy. When "financialization" and "cosmopolitan internationalism" set in, the end is near.

Boiling Point's applicability to elective politics is obvious. Clinton's campaign Svengali, James Carville, and his pollster, Stan Greenberg, are both well-known maestros of the emotions of the middle class, and the basic Clinton campaign mix of promises-middle-class tax relief, better health care, clipping the wings of Washington lobbyists--was entirely consistent with Phillips's message. Kevin Phillips can unquestionably elect--but can he govern? Does a workable program arise out of Boiling Point?

Phillips head

The difficulty of answering these questions is that, in a way, there are two Kevin Phillipses at work in the pages of Boiling Point. They might be called Heart Phillips and Head Phillips. Heart Phillips came up with the title and has a limitless capacity for middle-class rage. He loves people in "the humdrum middle and lower-middle," with their "parochial interests,'' and he despises the sophisticated, coast-dwelling, art-collecting, French wine-swilling, mansion-building, fortune-inheriting rich. He can work himself up into an indignant lather not just about big things like layoffs of middle managers, but also about the rising price of concert tickets, basic cable rates, parking garages, and weekly newsmagazines, and about the tendency of employers to cut back on company picnics and leadership development seminars.

His definition of the middle class is extremely generous, taking in perhaps 90 percent of the population; several times he goes out of his way to say that the upper-middle-class (meaning, to use one of his examples, people like orthodontists with six-figure incomes) is troubled, too. Only people with incomes above $1 million are truly ineligible for his sympathy. Heart Phillips doesn't like immigration, free trade, or deficit reduction (devotion to which bespeaks a "green eyeshade" mentality). He doesn't want to scale back on Medicare payments or Social Security benefits for wealthy retirees, and he hated President Bush's 1990 budget agreement.

Head Phillips, on the other hand, realizes that the problems of the middle class as Heart Phillips defines them are impossible to solve. Part of the trouble is that the middle class had such an amazingly good run between 1945 and 1965--its ranks growing, its income rising, its taxes low, its schools and health care improving--that conditions had to level off, especially after the rest of the world began to emerge from the rubble of World War II. Nobody seems to believe (Phillips certainly doesn't) that we can ever reproduce the rapid growth of the 1945-65 period--but the emotions driving Heart Phillips grow out of the expectation that life should always be that way. Head Phillips is the author of the last chapter of Boiling Point, which in a responsible, let's-focus-on-the-big-picture tone completely out of sync with the rest of the book, calls for "an agenda of shared sacrifice"; and it was Head Phillips who issued an endorsement of President Clinton's economic plan.

The only clear policy implication of the views of Heart Phillips is that federal taxes on the rich should be raised. Clinton has obviously incorporated this wisdom into his economic plan in the form of his new taxes on millionaires and CEOs--but these are grandstand plays meant to win over the middle class, not major new sources of government revenue. Phillips completely avoids, as Clinton couldn't, the necessity of taxing the middle class in order to salve its other wounds. Even leaving taxes aside, many of the problems Boiling Point describes are examples of what might be called middle-class cannibalism: one sub-group of the middle class (such as public employees) feeding on the flesh of another (such as tax-payers). There is plainly no way to alleviate every middle-class grievance while shielding the entire middle class, as Phillips broadly defines it, from any new taxes or other injuries. Eliminate wasteful bureaucracy in the health insurance industry in order to bring rates down, for example, and you've thrown thousands of hard-working claims adjusters out on the street.

Any truly optimistic scenario for the future of the American economy (and therefore of the middle class) involves substantially reducing the deficit and improving the educational system. And yet, it's hard to see how the middle-class beefs that fill Boiling Point could be substantially addressed at the same time. Because Phillips's ability to sense the public's mood is nearly unerring, Boiling Point gives rise to the question of whether national politics will now merely lurch from one eruption of middle-class anger to the next, with politicians terrified of contemplating anything that might damage the short-term interests of some segment of the middle class--such as the trade agreement with Mexico or a reduction in the growth rate of health costs. It's quite possible to have political gridlock created by public opinion rather than by powerful lobbyists.

The main unanswered question about President Clinton is whether his undeniable political genius is limited to the appearance of sharing the concerns of an amazingly wide range of people, or whether he also has the ability to rally a working majority behind some clear national mission that he defines. If it's the former, then he is going to be presiding over an unstable, frustrated electorate that cannot be successfully appeased.

Nicholas Lemann is a contributing editor of The Washington Monthly.
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Author:Lemann, Nicholas
Publication:Washington Monthly
Article Type:Book Review
Date:Mar 1, 1993
Words:2037
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