Tom Odhiambo
Who killed the middle classes? This is the subtitle of David Boyle’s book, Broke (Fourth Estate, 2013). The basic assumption of this book is that there was once a thriving group of people called the ‘middle class.’ But who were they in the middle of? Apparently they sat between the upper and lower – working or poor – classes. That these people had a stable life, a consequence of a good education – they had university training and degrees, a good job – a doctor, a lawyer, an engineer, an accountant, a university lecturer etc, a good family life – an educated and working spouse, just about two children, living in the suburbs, owning a house/home, have significant savings in the bank, have another property, are assured of retirement on a good pension, etc. These are more or less the characteristics of the middle class, the British middle classes.
But these attributes have been used to define the middle classes elsewhere in the world. In other words, the British standards of the middle classes have pretty much been the lenses through which individuals that are fairly stable socio-economically are seen. These are the standards that Kenyan policy makers, economists, journalists and the general public define the so-called middle class. So, in the Kenyan case, one may see the middle class as university-educated, professionals, living in the suburbs, either in their own houses or rented apartments, who can afford to take their children to private schools, can afford medical care in private hospitals, can pay for a holiday or two in a year, drive their own cars and generally can afford luxury goods. In other words, these are the people the advertisements on the billboards dotting the roadsides in Mombasa, Nairobi, Nakuru, Eldoret or Kisumu address. Those advertisements urge them to upgrade from mere ‘living’ to adopt a ‘lifestyle.’
And it is this idea of a lifestyle, or life with style, which is primarily associated with the consumption habits of the middle that begins to explain the supposed decline of the middle classes in the world. All over the world, economic statistics tend to show that the upper class is getting richer; that indeed what we have is a super rich upper class that is globally connected. Boyle says that this is the so-called ‘One Per Cent.’ This is how Boyle describes this super class: “The One Per Cent is dominated by people in financial services, and at the top of the global corporations, plus perhaps a handful of global bureaucrats. It is a deeply interconnected world – one study showed 94 directors holding 266 directorships in 22 corporations. But the real point is that they are doing very well. The number of billionaires in the world grew from 225 in 1996 to 946 in 2006. These are the customers for $45 million personal Gulfstream jets. They control two-thirds of the world’s total assets. They are the reason why house prices are so high in London ….”
What Boyle does in Broke is to show that the decline of the middle classes in Britain is a consequence of many factors, economic, social, political, cultural but most significant is globalization. Globalization may be defined in terms of travel of people, goods, culture, ideas and lifestyle, but it has been most effective due to ‘financialization’ of the economy. Financialization is what produces the overnight millionaires – the young men and women who only produce and retail financial goods. These are goods that aren’t really goods – there is no tangible economic production when a share value appreciates to three times its value in just a matter of hours. But people lose ‘real’ money – and therefore real property such as houses, land, household goods, cars etc – when the same share value depreciates three times its original value. The point is that the overnight millionaires would continue to grow rich even when the economy is shrinking because, as Boyle argues, they would buy back those same shares, at lower prices, thus increasing their wealth, or control over companies. Meanwhile, the poor will lose their shares, jobs, access to credit and move down the socio-economic ladder.
Also, the ease with which money now travels globally makes it so easy for the superrich to transfer their wealth elsewhere, for investment or just saving, ostensibly because of better tax regimes abroad. The implications are that in a matter of hours, a board meeting can decided to transfer money and human labour from one country to another thus depriving millions of citizens in one country of goods, services, income and worsening their fate in retirement or old age. The one consequence of money no longer being related to real goods is that money is now largely associated with banks and not necessarily property. In many cases this same property – such as cars, houses, office or work equipment etc – is based on a bank loan, meaning credit. This access to credit means that many of the so-called middle classes are beholden to banks. The tens of hundreds of Kenyans who can’t make ends meet at the end of the month should know that the middle class empire is a house built on quicksand, should they find themselves perpetually broke. So, if the middle classes ever got ‘broke’, they were broken by credit, therefore the banks, thus the finance men and women in those megabanks, but really by that One Per Cent.
