Meritocracy should be dismantled

Unsympathetic as they may seem to many, elite workers are stuck in a rotten cycle.

They’ve gotten their status by obsessing over rarified education and lifelong work obsession. They then work to ensure their kids get the same or better advantage, ensuring the system continues.

If a century ago, we saw the end of an aristocratic elite that earned income idly through generational wealth and factories they rarely entered, then today the meritocratic elite earn income working 100 hours a week as a corporate executive, attorney, banker or perhaps true technology leader. There was a time when we thought we solved this: In the 1950s and 1960s, well-intentioned reformers at Ivy League schools introduced a wave of merit-based admissions, which temporarily balanced the scales. But then rich families began to adapt to the rules and now they dominate them.

Rich kids are still more likely to get to elite schools, and then win in elite careers — but they bludgeon themselves with work in a way that their great grandparents wouldn’t have.

This worsens the fate of middle class, who have no chance of breaking into elite educations that are further owned by the rich — not now by hereditary handoffs but by buying elite education — and ensures generational poverty stays so. The elite get the same outcome but at a far higher cost.

That’s the thrust of Yale Law legal scholar Daniel Markovits’s fall 2019 “The Meritocracy Trap: How America’s Foundational Myth Feeds Inequality, Dismantles the Middle Class, and Devours the Elite,” which I just read. Vox review from back then here.

No doubt his timing was tricky. As his book was published the covid-19 pandemic began to swell. It’s taken me this long to come back to the book, though it’s on one of my favorite topics. He wrote in his acknowledgements the book came from years of work, and in the book he says the final push came from this May 2015 commencement address he gave.

He’s a dazzling writer, with some wonderful turns of phrase, but he needs only half of them. I found myself marveling over a pretty sentence, only to notice that he was essentially reasserting the same point he had just made. Nonetheless, I enjoyed the myriad ways he introduced and reintroduced his concepts.

Below I share my own notes from the book for future reference.

My notes:

“Merit itself has become a counterfeit virtue” it now reinforces “the concentration and dynastic transmission of wealth and privilege across generations”
Meritocracy is not equality of opportunity because it stifles social mobility, author argues
This concentrated elite through private schooling and work also leaves the elite “wealthy but not well”
His explanation for Trump? “Meritocracy inequality”
The “rich and the rest” suffer “ unprecedented resentment among the middle class and inscrutable anxiety among the elite” — “eddies in a shared stream, drawing their energies from a single current”
“Meritocracy’s charisma disguises its evils”
“The working rich boast that they are in demand” (“I’m so busy!) which the old elite would have found a humiliating admission
The meritocratic elite is composed of top income earners (1% of households), those in their social and economic orbit (5-10%)
Meritocracy trap comes in two movements: first, education is transformed into a rigorous and intense contest to join the elite, and then work is transformed into “immensely demanding and enormously lucrative jobs that sustain the elites
Elite universities once awarded placements based on breeding not merit, this started changing with James Bryant Conant at Harvard (1950s0 and later Kingman Brewster at Yale; they rebuilt college admissions to emphasize achievement not breeding
“Both the demands and the rewards of elite work are greater today than they have ever been before.”
“A leisured elite invited middle class industry “ — mid skill stockbrokers and independent merchants and small manufacturers all led the industry that the aristocratic elite ultimately owned but were indifferent toward
Gloomy (stuck) and glossy (shiny with income and status but brutal) jobs
In spite of common criticisms of Capital, between two-thirds and three-quarers of wealth disparity today compared to 1950-1970 is due to elite labor incomes, author argues
Fairfield County Connecticut has worse income inequality than Bangkok, Thailand
“Whereas aristocratic inequality was both wasteful and unjust, meritocratic inequality declares itself at once efficient and just”
Common criticisms of today’s income inequality get it wrong, author says: one says class background and legacy status are the cause of entrenched elite and this is just an extension of old style aristocratic nepotism; and secondly Thomas Piketty popularized the explanation that the shift away from labor to capital is the cause — both imply we need more not less meritocracy but author thinks this is flawed common sense
CEO pay over workers, cardiologist over nurse, lawyer over secretary: all saw their share grow from 1960s until today — they are doing more work
“Meritocracy is not the solution to rising inequality, but rather its root”
Uses St Clair Michigan on Lake St. Clair as an extended example throughout the book: once prosperous of middle class Detroit auto worker families it is now aging and shrinking
The academic performance gap between rich and poor students is now greater than between white and black students in 1954, the year Brown vs Board of Education was decided
The rich buy fabulous educations — the top 1% is better represented at Harvard and Yale than the bottom 50%, but even top quartile over represents the next two quartile of middle income by six times. (It’s not just rich and poor, but rather compression of middle and poor, while rich rises)
“Economic Inequality today produces greater educational inequality than American apartheid once did”
“The academic achievement gap between rich and middle class kids is now markedly greater than between middle class and poor kids.”

“Elite workplace are filled with people who would rather be doing something else, but who’s human capital has become too valuable (too essential to income and status) to squander on indulging personal ambitions.”
Author argues that middle class has sunk down to “lumpenproletariat” with the poor, and mindless work has spread to the elite — Marx’s new “exploited labor” with the added twist that they are both the labor and the (human) capital rentier status on their degrees and beholden to it so their kids get the same
“Meritocratic inequality might free the rich in consumption, but it enslaves them in production.”
Tells story of suicide clusters in elite schools, (more recently highlighted in Haidt’s Anxious Generation) like Palo Alto High school (Paly and Gunn) who kids hear the Caltrain as a cryptic warning whistle because several kids killed themselves that way
No one is saying have sympathy for the rich but it teaches us, author reminds
(((I’m reminded of recent social video arguing that luxury goods like TVs, furniture, food and coffee are cheap relative to rent and utilities)))
Palo Alto and St Clair were similar in 1960, author says, in population and economy. (Comparing two regions reminds me of 2012 book New Geography of Jobs)
Mid century Great Compression: middle class lives looked more similar in products and kinds to elite, it was the poor that was different — now that’s cleaving differently
Now the rich marry different, exercise more so look different, marry each other , go to college and sorting geographically
Benjamin Disraeli writing of the Indian caste system, but could be speaking about United States today, wrote that the the rich and the rest comprise “two nations; between whom there is no intercourse and no sympathy; who are as ignorant of each other’s habits, thoughts, and feelings, as if they were dwellers in different zones, or inhabitants of different planets; who are formed by a different breeding, are fed by a different food, or ordered by different manners, and are not governed by the same laws. “
Just 158 families provided nearly half of all campaign contributions for the “initial phase” of the 2016 presidential election, author says
Also arguing that in 20th century public wages were good salaries, allowing regulators to stay ahead of private sector (by retaining top talent) but as the professional and managerial class increasingly became tools of elite their incomes swelled so now public sector salaries cannot compete
Congressperson or a federal judge could make so much more in private sector
“Income defense industry”
Gary Cohn: “only morons pay the estate tax”
((Only one American banker went to jail for the financial crisis, Kareem Serageldin, more here))
Dryden’s old line: “That he who best deserves alone may reign” seems to self reinforce the elite status
Meritocracy “ justifies economic inequalities, and disguises class”
Meritocratic elite relies heavily on identity politics and racial division because it reinforces their virtue — but it only leaves everyone else nativism
The entrepreneurial and hereditary super rich appear to be treated differently — they chart unusual paths. It’s the professional class educated by elite institutions that appear a different caste that get the most anger — middle class ideals are to own a company, not to become a banker/lawyer
(((Interesting that it might be the poor kid who wants to use the elite to get rich, rather than middle class that increasingly despises the elite institutions)))
Obama attacked Great Recession through meritocratic and technocratic precision not a political reckoning; the Romney-Ryan ticket for reelection wasn’t the Palin Tea Party movement that could have swung an ax
Sam Wang eats a bug (on Smerconish’s CNN show) because he got Trump wrong

“When these voters heard the bipartisan elite condemn Trump as boorish or unfit for office, they knew that the elite thought the same of them”
Author says most of inequality comes from these higher wages not capital concentration
“Even as inequality increases, poverty is both rare and less severe (although it of course endures).”
“When progressives embraced meritocracy as a remedy for hereditary privilege, they fired the engine that now drives inquality’s increase”
Thorstein Veblen’s Theory of the Leisure Class: industry vs the “exploit” activities of the leisure class (like useless erudition in the classical languages or hobbies or sport)
J.P. Morgan: do away with leisure class, you do away with civilization
Bankers hours ended at 3pm; American bar association in 1962 estimated 1300 billable hours a year (so even if you addd a rule of thumb that lawyers work an extra third of hours, it’s no more than 30 hours a week). This was the mid 20th century professional and managerial class
Now there’s a bankers 9-5, which runs 9am one day to 5am the next

HBR survey of elite earners: 62% worked 50+ hours a week, 35% 60+, 10% 80 hours
Between 1984-1990, the percentage of lawyers working 55+ hours a week tripled
Time divide: those working much more and much less than 40 hours a week
Top 1% income earners: there are 1.5m households that earn in excess of $475k —250k VPs and above at S&P 1500, same number of VC and finance execs; half a million specialist doctors and maybe 100k top management consultants and law firm partners with large profits

Says Thomas Piketty ‘s influential 2014 book “Capital in the Twenty-First Century” gets something right but capital is too small a contribution, it’s elite income that drives income inequality
In early 1980s, 4 in 10 Forbes 400 were self made now 7 in 10 are —initially earning not from inheritance but compensation through stock or partnership shares
From the 1960s up the 2000s, elite earners get more of their money from income not capital and that’s before noting that the capital gains for an entrepreneur selling her company or carried interest to a hedge fund manager really is labor too
Estimates that top 1% income’s share increased from 10% of national income in mid century to 20% at time of writing: just a quarter of that gain was capital — the rest comes from elite incomes, and that could be an undercounting because of founder shares and carried interest (93)

The Giving Pledge is a disinheritance that would have once been bizarre to aristocrats: why has Zuckerberg confined his daughter to life of elite pursuit?
“The old elite culture of leisure has been replaced by a new elite culture of industry.”
Every economy has two kinds of inequality: between poor and middle, and middle and rich
Harvard economist Galbraith’s 1958 book “The Affluent Society” (popularized the phrase “conventional wisdom”) introduced the idea that private wealth was growing faster than public institutions
Sociologist Michael Harrington’s 1962 book “The Other America” (which helped introduce poverty statistics): Statisticians roughly estimate that 40% were in poverty in Great Depression but we only know that by 1963, it was 25%
In 2015, for the first time since Galbraith wrote, the majority of Americans were not middle class. In 1964, a middle class family median income was 4 times a poor family (average income of poorest quintile), now it is 3. In 1964, the average of top 1% household income was 13 times a middle class — now it’s 23 times as large. The inequality is at the high end
Harvard’s Greg Mankiw: ““Let me propose the following principle: People should get what they deserve. A person who contributes more to society deserves a higher income that reflects those greater contributions. Society permits him that higher income not just to incentivize him, as it does according to utilitarian theory, but because that income is rightfully his. This perspective is, I believe, what Robert Nozick, Milton Friedman, and other classically liberal writers have in mind. We might call it the Just Deserts Theory.”
Say the old aristocratic elite didn’t build the factory he inherited so taxing that is different, and harder to say that to the doctor or lawyer working 80 hours a week
“Poverty, indoors, of course, and relief remains a moral imperative. But the war on poverty (even if never completed) has transformed the political landscape. The politics of inequality now focus on the growing relative gap between the top and the middle rather than on absolute need at the bottom – -on frustration among the middle class rather than wretchedness among the poor. (Progressive nostalgia for the mid century economy, when the middle class thrived while the poor suffered, symbolizes this shift.)” 107
But middle class doesn’t conjure sympathy either — no visceral pain like the poor of the 1950s
The middle class has accepted this failure because they trust in the rules of meritocracy, so instead capital and nativism is an answer
James Bryant Conant at Harvard championed SAT as a mid century reform to boost quality
Nobel prize winner James Tobin was an early SAT success story
By late 1940s, Harvard had as many public school as prep school graduates — Princeton hit that in 1955 and then when Yale reformer Kingman Brewster took charge it came hard: in 1966, became first to adopt “need-blind” acceptance (choosing who to accept regardless of ability to pay), its 1970 class had 50% more public school grads than in 1969
The average SAT score for 1952 Harvard freshman would have put him in bottom 10% in 1960
In the 1960s, the dean of admissions at Yale, R. Inslee Clark, reduced the weight of legacy status and halved the proportion of legacies in the freshman class, from 24 to 12 percent. Outrage ensued. The conservative author and commentator William F. Buckley Jr. complained that without legacy preference, “a Mexican-American from El Paso High with identical scores on the achievement test … has a better chance of being admitted to Yale than Jonathan Edwards the Sixteenth from Saint Paul’s School.”
“The very same mechanisms that once destroyed aristocratic hierarchies and dynasties now wrecked me, Democratic hierarchies and dynasties in their stead”
Education is “a new dynastic technology of its own”
Assortative mating: a fifth of income inequality between 1960 and today
Only rich people stay married; 55% of poor households have single parent, 25% of middle income and less than 10% of those households with at least $100k — because money makes it easier and culture prioritizes it
School funding differences, plus what sorting of elite parents can do when they all live near each other and their PTAs can offer so much more
In NYC, public schools that raise more than $1m annually are called public-privates”
Educational inequality: rich kids are increasingly performing better than poor kids on tests — because they get so much prep
Midcentury, rich and middle class kids performed similarly well, and it was poor kids who lagged. This changed starting in the 1970s, and now rich kids are 25% greater than middle kids
College has gotten easier to access since the 1960s — but not the very elite schools
University subsidy via endowments: in 1967, this was $2500 per student on average among less selective schools, and $7500 at the most selective; by 2017, that was $5k vs $75k (139)
Apple’s early employee promise “a really neat trip while you’re here” implied no real investment in employees — in contrast to IBM and Kodak (though they didn’t keep thriving!)
Author estimates, and my simplifying: The average middle class professional will make the following investments in their average kid, including private school, activities and/or tutoring and other support: $15k per year in preschool, $25k in elementary school, $50k in middle and high school and $90k in college and professional school. All told, that could cross $1m if that kid goes all the way to an advanced degree. In contrast, a rich parent will invest in their kid $10m, nearly 10x even the highest standards.
Zuckerberg and others give away their money but not their “meritocratic inheritance” for their kids — elite schools
Whereas aristocratic inheritance tended toward profligacy (from shirtsleeves to shirtsleeves in three generations), meritocratic inheritance resists being wasted
No wonder Kingman Brewster, who was initialy attacked as betraying Yale aristocrats, is now the most celebrated president — he developed the meritocratic system they have today
Turtleneck syndrome in Seoul from over-tutoring
David Foster Wallace: the rich mistakenly think “that a self is something you just have”
William Whyte in The Organization Man (1956): in Aristocratic society rivals did not impinge on one another, to avoid any misstep that would get them thrown out. Members wrongly assumed that the collective organizational decisions were better than what one could make for himself
Today “industry constitutes honor”
“Innovations dramatically favor super ordinate workers and dramatically dis-favor mid-skilled workers”
Labor market polarization and skill based technological change
Rather than lousy and lovely jobs author thinks it’s gloomy and glossy (just a shine of appeal obscuring the distress)
Technology means more low level such high level jobs: At McDonald and banking and retail etc
A 1963 issue of The Economist asked of a then declining industry (that would soon boom): does banking have a future?
Oxford and Cambridge even have more low income than Harvard and Princeton
Management came into the world from 1850-1950 as manufacturing got more complicated — for example Singer sewing machines began to decide it needed to build its own component parts —- today it’s come back to 19th century outsourcing
Even Union leaders had “industrial self government” as the Supreme Court wrote in 1960
Walmart had full time employees
Instagram 13 employees when sold for $1b
Elite education has replaced workplace training
The college wage premium is 1.5 times bigger than France and Britain, and 3 times Sweden
A BA degree “gets you in the door” to top third of educated Americans, but without elite school or professional degree, the role is being overtaken
Karl Marx’s son in law Paul LaFarague 1883 book The Right to be Lazy
Keynes’s famous 1930 essay predicting less work in a sense proved true but misunderstood how honor and values changed — middle class got less time off but leisure looks differently when it’s under employment
“Justice Coyle was the antithesis of dignity in an aristocratic world that worshiped leisure, so idleness has become the antithesis of dignity today in a meritocratic world that worships industry.”
George W Bush and Bill Clinton born of different means (rich and middle class) but that did not meaningfully change their lives
“Among parents, meritocracy dominates attitudes toward marriage itself.
While professional and working-class couples were roughly equally likely to report being “very happy” in their marriages in 1970, today the share of “very happy” working-class marriages has fallen by a third even as the share of *very happy” professional marriages, after recovering from a dip in the 1980s, remains where it was. Similarly, the share of women with college degrees who agreed that “divorce is usually the best solution when a couple can’t seem to work out their marriage problems” fell by a quarter between 2002 and 2012.
Meritocratic elites even tie sex distinctively to marriage: rich women do not just bear but also conceive children within marriages, and the abortion rate among rich women fell by nearly 30 percent over the past two decades, even as it grew by nearly 20 percent among poor women.
Marriage, that is, retains a distinctive ideological power for meritocrats.
“Elites may reject traditional morality and affirm sexual freedom as matters of abstract political principle. But they live distinctively chastely, as nonpracticing libertines.”
Progress in gender pay gap comes principally from declining wages for men without college degree (210) — look at Men Without Work, and Claudia Goldin’s Greedy Jobs
In top quintile of household income, just 29% of women out earn husbands, in bottom quintile 69% of women out earn their husbands
Steve Jobs: Silicon Valley is a meritocracy
Rich Americans spend less time on leisure, watching TV and more time on exercise than poor Americans
Aristocratic elite bought leisure; meritocratic elite buy luxury goods (and luxury beliefs?)
Yale First Generation Professionals student groups: do these want to dismantle and keep their middle class or poor roots, or ease the path into the elite?
In 1975, middle income debt began outpacing income
The 1980s-ancestors of today’s financial quants were Cold War-trained physicists and mathematicians who didn’t have academic jobs as Soviet federal funding wound down — these rocket scientists transformed finance
Drexel lambert used old models not ever implemented to price risk of high yield junk bonds (The Black–Scholes model and options and even older Pascal-era modern probability theory were all finally put to commercial use)
Why would rich finance people need middle class loan officers having meetings with applicants when you can use data and collaterize the risk?
Management became financialized — debt not profits powering investments and highly specialized central teams and aggressive activist shareholders to maximize returns
Innovation once competed against skilled craftspeople — gunmakers, bakers, butchers, mechanics, glass blowers, shoemakers and smiths were all elite professionals who were transformed by technologies and manufacturing — but finance and management bent innovation toward elite education
U.S. and Japan developed different agricultural practices because labor was scare in one and land abundant, and the opposite in the other
England’s Industrial Revolution used interchangeable parts and processes to make sure of the flood of immigrant and untrained country labor into cities
The modern revolution has favored college educated because we had so many of them
“Innovation acquired its now famous bias in favor of skill not out of the blue, nor even on a account of technology’s necessary logic, but rather by tracking, even chasing, the new supply of skill that meritocratic education unleashed. The skilled-based innovations – in finance and management, and also in retail, manufacturing in across the economy – refocus production around super skilled labor. This suppressed middle class wages and increased elite ones. And Meritocracy’s trademark high-end inequality ensued.”
The rise in college grads induced the demand for them that came a decade after they boomed (1980s college wage premium begins climbing)
The “human resource curse” like the resource curse: elite workers attract narrow interest and investment for value extraction to the worse of others
Reminder: the term “meritocracy” was coined in a satire book
“Elite skills can exist and can command elite incomes only by sitting atop massive antecedent economic inequality.”
Increasing meritocracy has not boosted productivity, it’s an end itself to benefit elite
Consider a parable: a society of farmers and warriors in balance, until the warriors start an ongoing war with neighbors and so claim they deserve more pay and status because their labor is more important — but it’s only important because they started the war. Their value must take that risk into account, and so too with elite workers
Merit is “aristocracy’s commercial and republican analog, renovated for a world in which prestige, wealth and power derive not from one but from skill” 269
Author: don’t attack the meritocrats, attack merit itself
Arthur Okun: redistribution carries money from rich to poor in a leaky bucket
What was the only time income inequality was reduced without a war or a revolution? In the American progressive age, following the gilded age, and then new deal
Elite private schools being tax deductible nonprofits and allowing the rich not counting education spending toward inheritance tax is a massive tax shelter for the rich (it’s $10m investment in each kid), and university endowments
At least half a school population should come from bottom two thirds of income, and encouraged to expand student bodies — this mirrors adding black students and adding women to universities
As for work: regulation should encourage middle income jobs (nurse practitioners over doctors), and Payroll tax is too regressive (ie capping up to $132k~ on income that the 12.4% is filed), eliminate the payroll tax income cap
His alternative is the “democratic equality,” in which equal representation balances various interests

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