In Defence of Consumerism: The Dubliner’s Opinion

A writer for The Dubliner magazine, Robert O’Byrne, has written 3,442 words attempted to define what it means to be Middle Class in Ireland today. The title of the article is In Defense of the Middle Class, but apart from dwelling on clichéd notions of class in the 19th Century he doesn’t seem to know what class is, doesn’t engage with how our modern economy really works and decides to conflate how the Central Statistics Office categorized class in the 2006 census with how consumers are categorized by marketing executives using the NRS Social Grades, which were devised by newspapers and magazines to gauge who read their publications. So, in order to be accurate (and I assume, having written so much he would like to be) he should have called the article: In Defense of the ABC1 Consumer Group.

What makes his piece more notable for us at Dublin Opinion is that his exegesis required the misrepresentation of Conor’s arguments about Working Class in Ireland which he developed in a series of related posts here last summer and autumn.

But this misrepresentation doesn’t bother us. In fact, it provides us with the opportunity to illustrate how an erroneous notion of class is disseminated for the purpose of maintaining the dominant ideology which prefers that ordinary workers should be as powerless as possible. Its also a perfect example of how sections of the media is at least partly responsible for perpetuating the myth of worker-as-consumer in order to ensure that those worker/consumers continue to buy the things advertised in their magazine. Indeed, it is in the magazine’s interest to suggest to the reader that, rather than being financially stretched trying to cope with the rising cost of living, that they are in fact finally moving up in the world.

I could go through the article in detail, pointing out why Mr. O’Byrne is wrong at each stage of his essay, but then I’d run the risk of boring the pants off our reader – should he or she even wear pants.

Let us say that the crux of his argument is that most Irish people are middle class not because of their occupation or the level of real power they wield within an economy but because of their levels of disposable income. They may be categorized as skilled manual by the CSO’s Census for 2006 or C2 if you follow the NRS Social Grades, but they shop like a Solicitor or an A1 consumer. In the past, so the Irish popular imagination has it, only the middle classes were able to shop in Brown Thomas and go on two or more holidays a year. Only the middle classes were able to pass around their photos of little Seán learning to ski on the Piste. Only the middle classes were able to change their car every year because they were on first name terms with their bank manager, who was also probably their neighbour. Now everyone can do it.

There are two problems with Mr. O’Byrne’s argument. The first is the idea of using the NRS Social Grades, which are grades of consumers, as a way of defining class in society, and the second is the assumption that the vast majority of working people are now enjoying pay levels which are the equivalent of engineers, solicitors, barristers and accountants: a professional grouping that constitutes the real middle class. He does this by conflating access to relatively inexpensive credit with levels of real affluence and suggests that owning property automatically bumps you up into a higher class.

There can be no doubt that in the last 35 years, as Mr. O’Byrne states, the number of private households has expanded considerably, especially within the last five years. There is also no doubt that the economy has continued to expand in that time, and with that the size of the population has also increased with many non-nationals as well as returning Irish emigrants increasing the demand for housing. There is also the additional factor that historically low interest rates, matched by a period of almost full employment has meant that in that time the means of buying a house were made considerably easier.

However, Mr. O’Byrne fails to mention the property bubble and how the prices of houses have grown exponentially, aided by unchecked property speculation. Banks for their part, were willing to offer loans, usually based on the joint incomes of both spouses which were enough to pay these exorbitant prices thus enabling the bubble’s continued expansion. Now we have a situation where the repayments that these so called new middle class people have to make on these over-valued houses are actually making it difficult for them to afford other necessities such as fuel and food. Now we have a significant number of ordinary workers who are living with negative equity.

As David McWilliams pointed out yesterday in The Irish Independent, property has traditionally been a way people to generate wealth. By ordinary workers being able to buy property they are able to use their income to accumulate wealth. However, because of unchecked property speculation this has now lead to many becoming over stretched to pay for houses whose value is dropping or who can’t afford a house at all.

And this, ultimately, is not good for society as a whole:

“This is why the property binge has been so damaging to the fabric of our society. It has put property, possibly the one true comprehensible wealth-creating asset, out of the reach of thousands. So it doesn’t matter how much income you transfer in budgets and the like, because without wealth, income disappears like sand through your fingers.
More egregiously, by turning property into a speculative game of Paddy last, the poor Paddies who bought last will now experience the ludicrous situation where land, in one of Europe’s least populated countries, becomes an instrument of gradual indebtedness rather than wealth creation.”

O’Byrne tries to define class in terms of consumer categories because he says that we have no clear analysis of class in Ireland. After using the example of a Dublin Bus driver who O’Byrne calculates could earn up to 38,000 euro a year, thus moving him out of the ranks of the working class(!) he goes on to say:

“…when it comes to Irish society, a lot has changed in a little time. There’s a great deal of catching-up to do, not least in how we officially define class here. To date, no formal investigation has been conducted on the subject, not by the CSO or the ESRI or by the leading marketing survey companies. As a rule, when it comes to determining status, we’re forced to fall back on the NRS Social Grades.”

It is interesting that he abandons any idea of looking at class in terms of power relations – how people are categorized in a class based on the amount of real power they have within an economy – and instead reverts to thinking of workers simply as consumers. I do not believe that Mr. O’Byrne did this for want of a definition of what class means in today’s society, but rather to position people according to their level of consumption in order to reinforce an ideological position.

Because if Robert had read all of Conor’s posts on the Working Class he would have come across quotations from Michael Zweig, an American scholar who has written extensively about class in the US.

Michael Zweig defines class in the following way:

“I define classes in large part based on the power and authority people have at work. The workplace engages people in more than their immediate work, by which they create goods and services. It also engages them in relationships with each other, relationships that are controlled by power. A relative handful of people have great power to organize and direct production, while a much larger number have almost no authority.

[Working class people] are skilled and unskilled, in manufacturing and in services, men and women of all races, nationalities, religions. They drive trucks, write routine computer code, operate machinery, wait tables, sort and deliver the mail, work on assembly lines, stand all day as bank tellers, perform thousands of jobs in every sector of the economy. For all their differences, working class people share a common place in production, where they have relatively little control over the pace or content of their work, and aren’t anybody’s boss.”

So, its about power. How much you have or rather how little you have within the circumstances of your employment dictates what class you are a part of, not by your ability to consume.

And also Zweig, looking at the United States, an economy not dissimilar to our own – in that both have dominant neo-liberal economic view points which are backed by strong state support - is familiar with the notion of how everyone is now living a middle class life style:

“One common misunderstanding of upward mobility is raising family income. Since working class families now earn much higher incomes than they did fifty or a hundred years ago, who can question the reality of upward mobility and the good life workers have under capitalism? This argument is often made in terms of lifestyle: almost everyone lives a middle class lifestyle now (except the rich and the poor), so most people, including workers, must be middle class. …But an increase in personal possessions doesn’t catapult workers into the middle class. The lifestyles of the middle class have also improved dramatically – to say nothing of the capitalists (the upper echelons of Capitalists society). It make no sense to compare the workers of today with the middle class of 1945.”

In the case of Ireland change 1945, when things certainly weren’t rosy in the garden, to any time before 1989.

To replace a notion of ourselves as workers who strive to increase pay and rights with that of consumers erodes the little power we have with in society. Because as consumers we are entirely passive – the collective power of consumer demand is a myth and any power that one may have as an individual consumer is dissolved by the manipulative efforts of producers, advertisers, and somewhat down the pecking order, feature writers for glossy magazines.

But this is to engage with Robert’s argument at a level that he is not interested in. Indeed, his notion of working class, a class he thinks doesn’t really exist (which begs the question, is the middle class a strata of people that some how floats unsupported in the air with nothing below them?), is spectacularly wrong. In his view what constitutes the working class are actually people who are unemployed:

“Yes, there still exists a working class in Ireland, even if many of them don’t actually work; witness the obstinately high rates of unemployment in parts of west Dublin and elsewhere around the country.”

But in the interests of brevity I would like to move on to real levels of income, the main criteria by which Mr. O’Byrne bases his argument that the majority of Irish people are middle class. Robert refers to the argument made by Conor, says:

“Based on a breakdown of occupations listed in the 2006 census, Mr McCabe managed to find 1,125,650 Irish citizens employed in what he regarded as ‘working class’ occupations. While some of them can certainly be regarded as such, like those who work in rail construction and maintenance workers (all 548 of them), others are open to debate.”

Perhaps, but when using his example of the bus driver he estimated that the driver, based on an advertised rate published by Dublin Bus, could earn up to 38,000 Euro. This, O’Byrne contends is a middle class income. Or, by citing the However, recently the Cork TD Deputy Ciarán Lynch asked the Tánaiste and Minister for Finance Brian Cowen how many tax payers in 2006 or the most recent year for which complete figures are available, returned incomes of €38,000 or less.

In his response Mr. Cowen stated:

“I am advised by the Revenue Commissioners that the estimated number of income earners on the income tax records in 2006 earning gross income of €38,000 or less is projected at 1,452,000. Gross income is income before adjustments are made in respect of capital allowances, interest paid, losses, allowable expenses, retirement annuities etc. but after deduction of superannuation contributions by employees.”

My maths isn’t great, but as far as I can tell 1,452,000 is a higher number than 1,125,650. Moreover, when you put this figure in relation to the workforce as a whole you find out that this amount of people constitutes two thirds of the Irish workforce.

So, every year, two thirds of Ireland’s workforce earns the same or less than a ‘middle class’ bus driver from Finglas. But do we know how many are close to that middle class rate of 38,000 - the same amount remember that Bertie was due to earn in his latest pay hike – and how many of that two thirds were well below it.

Thankfully we have Michael Taft to guide us. In November of last year he wrote a fascinating post on this very topic. To begin Michael makes the point that when talking about Middle Class people often get confused and are in fact talking about middle income earners.

These of course, are not the same. But let us presume for the moment that with all the wealth sloshing about that Mr. O’Byrne when he refers to the middle class is actually referring to middle income earners. The truth is that when it comes to income the majority of it is controlled by the top 1%. And as such it is that 1% who have the most power in society.

Before I go into the breakdown, however, I should point out that Michael is writing his post in reaction to David McWilliams claim at the time that, wait it for it, we are all Middle Class Now. This is interesting because in yesterday’s Irish Independent article cited above McWilliams says:

“In terms of the income gap between rich and poor, Ireland is right in the middle of the EU income league. The salaries of the top 20pc are over four times the average of the salaries of the bottom 20pc. This places Ireland above the UK, Spain, Italy and Greece but below Germany, France, Denmark and Belgium. However, the big problem in Ireland is not income – where all the Government’s efforts have been centred – but wealth. The gap between the wealth of the top 20pc in Ireland and the bottom 20pc is phenomenal. For example, the top 1pc of the country owns 24pc of the wealth and the top 5pc hold 40pc of the country’s wealth, according to Bank of Ireland figures.”

Of course, McWilliams is talking about the poor, where as we are talking more about the average worker. However, the real earnings of all workers are analyzed by Michael and are based on the 2005 EU Income and Living Survey published by the CSO.

Unfortunately, rather than paraphrasing I’m going to quote chunks, because it helps explain the situation more clearly:

“The CSO groups households into deciles – from the lowest 10% to the highest 10% and records both direct income (from employment) and social transfers (e.g. Child Benefit, social welfare payments, etc.).

The lowest 10% earned €171 per week, or less than €8,900 a year. Compare that to the top 10% earning slightly over €110,000 a year – over 12 times more than the poorest. That’s all net, after tax. Those are the extremes.

What about those in the middle? The average gross household income in the state was €776 per week, or a little over €40,000 per year. This average, or middle, figure is hardly a ransom, especially as this includes two-income and even three-income households.”

So the average earnings of middle income families is in or around 40,000, which is pretty close to the aforementioned 38,000. But it also a considerable distance from what the top 10% earn a year - slightly over €110,000. Is it this salary level that is fueling the spectacular consumer boom that is making everyone middle class. I seriously doubt it.

But, there’s more. Michael continues…

“However, averages can be misleading since extremes can distort the mean figure. So let’s break down the deciles into three groups:

• Lower-income groups: the lowest three deciles or 30%
• Middle-income groups: the middle four deciles or 40%
• Upper-income groups: the upper three deciles or 30%

So how much do middle-income households earn a year? In gross terms (before tax) between €404 and €1,169 per week. Or between, approximately, €19,900 and €49,200 per year, after tax. Of course, there is a considerable life-style difference between a single household at the upper end of this scale and a household with two partners and two children. But one is struck at how little middle-income earners take home.

So middle is the middle-income group that a household with two workers on the average industrial wage would actually find themselves in the top 30% income group.

Nearly two-thirds of all households earn less than the national average, so skewered is income in favour of highest groups. And if the CSO data included wealth and property, it would be skewed off the chart.”

So if two thirds of the workforce is earning less than the national average where exactly is this vast middle class supposed to be coming from?

However, the cracks in this lie that we are all middle class is starting to show. Perhaps the single most egregious display of the disparity of earnings between the top 5% of earners and the relative powerlessness of the majority of workers was the recent proposed pay hike for senior civil servants, directors of semi-state companies and Government ministers.

Writing in Saturday’s Irish Times, one would have been surprised at the tone of Stephen Collins article chiding the Government for letting the cat out of the bag regarding this obvious disparity.

“Of course, politicians are not the only privileged group to look after themselves. The professionals at the top of the economic tree, like lawyers and doctors, have shown a voracious appetite for accumulating wealth over the past decade, much of it funded either directly or indirectly by the taxpayer.”

Such a group, who by their wealth hold a significant amount of the power in this nation are indeed what one would called the real middle class.

Interestingly, Michael Taft produced a graph which illustrates perfectly the distribution of wealth in this country, using the same guide that McWilliams refers to above: the Wealth of the Nation report published by Bank of Ireland Private Banking.

It illustrates the situation perfectly:

However, this article has gone on long enough. At this stage I have written approximately 3,200 words, which is almost as long as Mr. O’Byrne’s original article of 3,442 words. However, Mr. O’Byrne calls himself Middle Class, unashamedly so. Yet he admits that he doesn’t earn that much.

“A few weeks ago I had to take a taxi. Fortunately a radio station was paying the fare because, naturally enough, like everyone else in this country I earn barely enough to survive.”

Leaving aside the fact that this contradicts his main argument I hope he earned enough for his efforts writing an article which was designed, it seems to me, to perpetuate the myth, required by the dominant ideology, that people should consider themselves to be middle class consumers even when in reality – and unlike the real middle class - they earn less and are considerably less powerful than that label would seem to suggest.

While he earned relatively little we can assume that the adspace that surrounded those 3,442 words was sold by his publisher for a packet. Nice one Robert.