Typecasting the American Dream


Ever since economists failed to predict the Great Recession of late 2007 to 2009, a growing number scholars in the field have added a greater historical and philosophical sense to their empirical research. It is no surprise that these economists are mostly of the Austrian school or influenced by it, since that school’s founders—Carl Menger, Ludwig von Mises, and F.A. Hayek—viewed economic data with suspicion. Their heirs in America include Russ Roberts, Michael Munger, Deirdre McCloskey, and Tyler Cowen.

Among them, Cowen, the Holbert L. Harris Chair of Economics at George Mason University and director of George Mason’s Mercatus Center, has best escaped the boundaries of his discipline to become a public intellectual who examines his assumptions as an economist by the light cast by other disciplines in the humanities and social sciences. Such an approach gives his work an admirable breadth, not to mention making it remarkably accessible to non-economists.

His new book is no exception. The Complacent Class: The Self-Defeating Quest for the American Dream has nine chapters. The first four draw mostly from economic and other social scientific data to try to explain an unhealthy trend that Cowen detects in our society, and even in the American character: a loss of flexibility and concomitant embrace of the status quo that were never, he argues, as pronounced before as they are today.

The central chapter identifies the core mechanism behind a new American complacency: the dramatic increase in an individual’s ability to match his or her interests to those of others. The final four chapters are more philosophical, though grounded in the key empirical insights explained earlier. Cowen calls himself a “happiness optimist but a revenue pessimist.” The thesis of the book explains why:

Given the growing success of the forces for stasis, I see complacency—a general sense of satisfaction with the status quo—as an increasingly prominent phenomenon in America life. And I’ve coined the phrase the complacent class to describe the growing number of people in our society who accept, welcome, or even enforce a resistance to things new, different, or challenging. These people might in the abstract like some things to change, they might even consider themselves progressive or even radical politically, but in fact they have lost the capacity to imagine or embrace a world where things do change rapidly for most if not all people. (Emphasis in original.)

Complacency runs contrary to what the author regards as the central trait of the American: her restlessness. Restlessness is a good thing, in Cowen’s view. It signifies the successful pursuit of economic opportunities, a dissatisfaction with the status quo, and the constant effort to innovate. The choice facing Americans, then, is either a kind of desperate preservation of the status quo and, with it, a rapid shrinking in opportunities; or the return to restlessness, with all of its risks, its violence, and its mobility.

He expresses doubt that American restlessness will make a comeback, at least in the near-term. His doubts are based on his division of Americans into three groups: The Privileged Class (the top 5 percent of incomes), Those Who Dig In (the broad, stretched-thin middle defending what they own), and Those Who Get Stuck (the income-earners lower in the scale, and those without an income, both of whom lack opportunity and pursue security in government benefits).

Oddly, Cowen does not stick to these labels throughout the book despite their utility. What is clear, though, is the common denominator of the three classes, who otherwise harbor a good deal of political and economic contempt for each other. It is this desire to preserve the status quo. Americans have grown complacent with a marketplace that matched The Privileged with each other. The Privileged, in turn, sought to meet the demands of the other two classes. The Dug-In received from The Privileged the stability they wanted, and The Stuck received the economic relief they thought they needed. The consequence was that, from the 1960s into the present, we gave away our restlessness to hold on to what we have.

For Cowen’s audience, this is all pretty counter-intuitive. The clichéd responses of the American optimist (including many who produce Austrian School-influenced scholarship and journalism) write themselves: Creative disruption never fails! Dynamism! We have in our pockets more computing power than NASA had when U.S. astronauts first landed on the moon! We have instantaneous communication with anyone across the world! We have in our pantries better food than the kings of Persia had!

His retort is a sobering one. “Had the pre-1973 rates of productivity growth prevailed post-1973,” he writes, “household median income in the United States would be over $90,000 rather than in its current neighborhood of $50,000.” He goes on:

Do the user values of Facebook and Google and other free services really make up for this gap? Another way to put the question is this: that $40,000 yearly difference amounts to more than $3,000 per month. If a web connection or smartphone costs $3,000 a month or more, how many people would be buyers?

The book’s most ominous message is that our complacency cannot last:

In all systems, pressures build for change, and the more we shunt aside or postpone those pressures, whether through segregation, poor mobility, political dysfunctionality, sluggish productivity and debt-financed economic growth, or general disengagement and miasma of spirit, the stronger they become.

Cowen argues that Americans have unwittingly built this pressure themselves, continuing, as they do, to shore up the current economic and political arrangements in hopes that they might find themselves among the shrinking portion of the population that continues to benefit from them. The most effective means for preserving these benefits is for those at the top protect their privileges, and they do so effectively by using the technologies so many techno-optimists boost.

Technological change has disproportionately benefited those in the knowledge economy, and these beneficiaries use matching techniques to consolidate their earning power. Social media, dating apps, as well as admissions offices at elite universities each reinforce these matching, or weeding-out, practices. Those with high earnings, or high-earning potential, get matched up, while denying those down the income hierarchy the ability to “marry up” the way a mechanic might with a local banker’s daughter. Now, bankers marry bankers.

For Cowen, this kind of matching is definitively anti-restlessness. It preserves and exploits existing economic opportunities, which in turn creates an appetite for the status quo. As time goes on, innovation can only occur within narrower and narrower areas, and under conditions that limit the risk that The Privileged might experience.

The first half of the book is taken up with this theme, and Cowen works it capably. Because he must condense a tremendous amount of economic research, he aims for clarity over poetry. Paragraphs can feel repetitive, but he does his admirable best. In the book’s second half, which leaves data behind in favor of philosophical reflection, the author reaches highs and lows that reveal the unresolvable tensions not only in America, but also in Tyler Cowen’s view of the world. In this second half of The Complacent Class are its weakest chapter and its strongest chapter.

The weakest is “How A Dynamic Society Looks and Feels.” In it, Cowen compares the dynamism of Chinese society favorably to American complacency. Its hero is Jack Ma, the founder of Alibaba, a web site that combines for China and many other nations the attributes of Google and Amazon.

The author regards Ma as a paragon of economic dynamism, but the treatment is unsettling. China is a nation well-known for using bureaucratic and violent methods for preserving peace and order over democratic instability. Ma is an example of a man who succeeded with government permission, somewhat like Elon Musk here at home. The praise for Ma reveals something about Cowen that should give the reader (and Cowen himself) pause: his tendency to idolize tech moguls.

This idolization is, in fact, hostile to his own thesis. Mainland China is a nation rife with monopolies and government-granted licenses that Cowen elsewhere (in the American context) decries as tools of complacency. Americans should pursue a different view of the economic life. Cowen should look for the town where citizens have found work and preserved civil society with greater independence from government intervention or assistance—a place in which success is linked to social obligations and good citizenship.

Oddly enough, Cowen begins to argue in this direction in the book’s best chapter, “Political Stagnation, the Dwindling of True Democracy.” Here he discusses Alexis de Tocqueville’s Democracy in America and the late Peter Augustine Lawler’s work on that great French thinker. Lawler has been one of Cowen’s most compelling interlocutors (including in the pages of Law and Liberty). Cowen here takes on the Lawlerian theme of the gradual loss of the American “transcendental frame” that provided a deeper meaning for life beyond physical wellbeing.

He begins by noting that American voters “have an abstract desire to end the congressional flight from accountability, but on so many particular issues it just doesn’t seem pressing to the complacent class.” American politics, as a result, comes down to “who is to blame” and not “who is to govern.”

Cowen concludes that Tocqueville’s predictions have mostly come true: Americans have ceased to be restless searchers for material wellbeing as material wellbeing became the end in itself. Lost is any context or higher perspective that would remind Americans of virtues more important than mere material success. The result is what Tocqueville called “pantheism,” which Cowen reinterprets as “a general stand-in for the phenomenon of self-constrained complacency.” This statement opens the door for incorporating a transcendent view of the world to remedy problems that the author has largely defined in material (economic and politics) terms.

What he says here works against the prior two chapters, revealing to his readers that the tensions in America and in Cowen’s work are really the same tension: For a democracy, material wellbeing does not solve problems but creates its own even more intractable ones, especially in the absence of a transcendental frame, yet such a frame requires re-examining the role of material wellbeing in ways that frustrate our expectations of it.

The book ends with trenchant insights about the coming turbulence. Cowen identifies the growing racial unrest on college campuses as a kind of canary in the coalmine, wherein minority students agitate on behalf of the segregated minorities first and hardest hit by the accelerated stagnation of a post-Great Recession world. He predicts that the time is coming in which street violence will return and potentially overrun institutions of higher learning, and perhaps other institutions.

After all, if “the complacent class” has insulated itself from institutions of democratic accountability, all of the means that the rising agitated classes will be able to use will be extra-institutional. Which is to say, they will use violence. In one of the most complacent cities in America—Portland, Oregon—pro-Trump and anti-Trump crowds came armed with anti-riot gear and improvised (and not-so-improvised) weapons to assault each other and police. While the police managed the crowds effectively, they also commented on the sheer volume of gear they had to confiscate in the process.

A concluding thought: Cowen gives his complacent classes a little too much credit. This book shows us a class whose members are only complacent on the surface, as if he only knows them from their Instagram profiles. The truth behind the matching, sorting, and weeding-out is that it is anything but complacent—it is a desperate effort to stay on the right side of upward mobility.

One income is no longer enough for a family to be able to live in any major city. Upwardly mobile couples delay having children (so-called “DINKs” or “Double Income; No Kids”) so as to take in the wealth necessary to pay down debt and save up enough for a down payment on a house. Those children they manage to have are put on highly scripted paths with predictable outcomes. Perhaps the most complacent city in the world, Palo Alto, California, is also the site of tragically high teen suicide rates. In a suburban imitation of The Hunger Games, parents and students regard each other not as neighbors but as competition in the zero-sum game of elite admissions that provides the only risk-free method for securing material wellbeing. American restlessness is not dead but deadened by a double-dose of Xanax.

James M. Patterson

James M. Patterson is Assistant Professor of Politics at Ave Maria University.

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  1. says

    “Cowen should look for the town where citizens have found work and preserved civil society with greater independence from government intervention or assistance—a place in which success is linked to social obligations and good citizenship.”

    In that town there is no class of people who don’t care, excepting the dissidents, who are constrained by civic statutory law.

    This “society with greater independence” is readily available to the town wherein a super majority, we guess 2/3 of the population, collaborate for civic morality, where “civic” means citizens who use the preamble to the constitution for the USA and the articles and amendments that follow to continually discover and effect public morality while pursuing the happiness they perceive rather than someone’s ideal. Avoiding arbitrary ideals is attained by collaborating to discover the-objective-truth of which most is undiscovered and some is understood.

    Comprehensive safety and security provides the “transcendental frame,” wherein young civic persons acquire the understanding and intent to provide goods and services the town needs or wants and in return are paid enough to afford the liberty-to pursue the private interests and dreams their person possesses plus savings and asset accumulation for retirement. The acquisition of education is enhanced by coaching which inspires each newborn to gradually take charge of his or her authenticity as a human being. Chronologically adult dissidents to safety and security are constrained by just statutory law rather than arbitrary opinion.

    Individuals whose person has high hopes and dreams look for opportunities to improve comprehensive safety and security. With a promising innovation, they enter entrepreneurship, and with success are happily awarded part of the benefits the town received. With failure, they retain obligations and resume ordinary provision of needed goods and services.

    People who have discovered inspiration and motivation through religion or none equally collaborate for comprehensive safety and security.

  2. gabe says

    “The Dug-In received from The Privileged the stability they wanted, and The Stuck received the economic relief they thought they needed. The consequence was that, from the 1960s into the present, we gave away our restlessness to hold on to what we have.”

    Cowen is simply wrong about this, i.e., “…received the economic relief…”

    Starting around 1990, end of the cold War, the great social contract between the managerial class and the working / middle classes WAS abandoned by the managerial class who in pursuit of sustained higher earnings made a conscious decision to undercut the working citizenry and the power of labor by “globalizing”, using labor and tax arbitrage to boost earnings and keep downward pressure on wages.

    Also, it will not be long before his “complacent” class becomes another “pissed-off” class.

  3. Scott Amorian says

    “People are too complacent.” “Violence is inevitable because blah, blah, blah.” I’ve heard these songs before. They’ve been sung a million times.

    And when did my hometown, Portland, Oregon, become one of the most complacent cities in America? It’s one of the most aggressively progressive.

    For every technological advance that limits chaotic intermingling, there are two more that enable more chaotic intermingling. The best example: Before the Internet communications between scholars only took place in journals and letters. And here we have an excellent scholar being read by and responded to by working class schmucks like me and Gabe, and the occasional kook (as is found in another respondent’s commentary). Overall, technology accelerates and expands interactions.

    The book certainly has some interest to scholars, but I’ll skip this tome, thanks.


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