For most of American history it seemed that anything was possible—that the next generation would live significantly different and better lives. Today that sense of dynamism is waning. We are more anxious to keep what we have, and to avoid others who might see the world differently or threaten our status, than we are eager to create something new.
The only major exception is information technology, which has spawned a stunning revolution over the past several decades. But paradoxically the internet compounds the problem in many ways—keeping us indoors, entertaining us, distracting us from the lack of improvement in the rest of our lives. It efficiently matches us to the people most like us. It adds to the country’s already growing sense of complacency.
In The Complacent Class, the celebrated economist Tyler Cowen backs this view of today’s America with a startling array of evidence. He depicts a sclerosis that is severe but ultimately not capable of paralyzing us entirely. He argues that complacency contains the roots of its own demise, and that we are already seeing a rebellion against the lack of initiative that took over the country starting around the 1980s.
The Complacent Class makes for depressing reading because most of it is devoted to proving that America has spent years headed in a worrisome direction. Cowen’s “complacency” encompasses countless ways, big and small, that American society is slowing down, resisting change, or just losing its restlessness.
Where have we gone wrong? Let us count the ways.
1. The economy isn’t growing much for a lot of the population. By one measure, the median male wage is lower today than it was in 1969. This measure may not account for inflation accurately, but, as Cowen writes, the fact that such a claim is even remotely possible speaks volumes. No one would have expected such weak progress half a century ago. A study released after the book was finished drives the point home further. Nine-tenths of kids born in 1940 out-earned their parents; only half of kids born in 1980 do.
2. The business world is becoming less vibrant. Startups were 12 to 13 percent of the economy in the 1980s, but now they’re 7 to 8 percent. Most industries have become more concentrated; some are dominated by just a handful of firms, stifling competition. The biggest firms, meanwhile, are valuable not for the factories they own but for their fragile “intangible assets”—their brands, company cultures, etc.—which encourages them to play it safe. Also troubling is a marked decline in research-and-development spending.
3. We’re moving less geographically. Indeed the interstate moving rate has fallen to half of its 1948–1971 average. Geographic immobility contributes to socioeconomic immobility as well because those from poor areas are staying put instead of flooding into thriving cities where they could make more money.
4. We’re aging as a society thanks to low birth rates, which means less dynamism comes from the natural restlessness of youth.
5. Half a century after the civil-rights era, segregation is on the rise. This is true whether you look at income, race, or even political affiliation. It’s happening everywhere, with some aspects of the problem being especially pronounced in liberal Northeastern metropolitan areas.
6. We’re agitating for change less effectively—though also, fortunately, less violently. Protests require permits and are relegated to “free-speech zones.” Riots seemed like a thing of the past until recently.
7. The government is on autopilot. The federal budget is largely consumed by entitlement programs for the elderly and the poor (considered “nondiscretionary”), and state budgets are increasingly eaten up by public-employee pension costs. As a result there is little room for the people to assert their will through the democratic process.
Covering such a complicated set of topics in relatively few pages, The Complacent Class can sometimes feel scattered and unfocused. Indeed, Cowen can find evidence of complacency just about anywhere—including drug culture, which has abandoned the LSD and cocaine of decades past in favor of opioids and legalized marijuana. But the book succeeds in hammering home its thesis that the American dream is in deep peril, and that we are drifting into a lethargic stupor as a country.
The complacency Cowen describes has many manifestations, and unsurprisingly it has many causes as well. They vary in their insidiousness.
Any society is bound to congeal somewhat as it matures and grows. Good businesses expand and destroy less stable ones, leading to a degree of market consolidation. Those who lived rags-to-riches success stories in one generation pass their talents and connections along to their kids, reducing mobility.
Other trends may be lamentable but are well-established. The internet might help us cloister ourselves with the like-minded, but no one’s talking about banning the internet. Cowen writes that globalization may have targeted the least stable American jobs, leaving us with jobs in industries with less churn. But, while we may resist further globalization, in all likelihood we are not getting those lost jobs back.
Yet our complacency isn’t just something that happened naturally or was an inevitable side effect of modern technology and globalization. In many ways, governments have promoted it.
One reason the poor are so unlikely to move where the jobs are, for instance, is that the most productive metro areas are also the most expensive places to live. This was not always true, at least not to such an extent as today. But we see it now largely thanks to local land-use rules that are designed to prevent development. Put simply, housing is so expensive because it’s illegal to build enough of it. Gentrification, also backed by local policies, also drives up rents. Local residents benefit from keeping out the competition and running up property values, but it makes the economy far less efficient than it could be. Cowen cites one study estimating that deregulating land use could increase the size of the economy nearly 10 percent.
Many other policies will occur to readers, however, about which The Complacent Class has little to say. The dramatic rise of regulation in general, for instance, would seem to tie in directly to Cowen’s themes here. It both reflects a risk-averse mentality and in turn makes the economy less vibrant. (Cowen lets us know that he discussed regulation in a previous book.) And, just as the residents of San Francisco and New York City have conspired through their lawmakers to keep rents high and competing workers out, crony capitalists across the country have extracted subsidies from the government and worked to foist regulations on their competitors, making their businesses more stable at the expense of upstart firms that may have better business models.
The welfare state is another potential culprit to which Cowen devotes little attention. Might it be encouraging complacency? Eli Lehrer and Lori Sanders of the center-right R Street Institute, for instance, have pointed out that welfare programs “t[ie] the poor down to their city or region” because those who move can lose housing vouchers or other benefits depending on what’s available in their new locale. Lehrer and Sanders propose allowing those who lose their jobs to “cash out” a year’s worth of unemployment benefits in a lump sum if they use the money to find a job somewhere else. Similarly, Nicholas Eberstadt of the conservative American Enterprise Institute argues that welfare and disability programs have financed an exodus of working-age males from the labor force: over the past half-century, working-age men have become increasingly likely to go without jobs, and at the same time the disability rolls have dramatically expanded. More than half of men out of the workforce live in households that claim disability benefits.
On immigration, meanwhile, Cowen raises more questions than he answers. He notes, for example, that Mexican immigrants are among the few groups in this country who still move en masse in response to changes in the economy, presumably because they are less rooted to a specific American city than American natives tend to be. If we had lower immigration levels, might companies in growing cities raise wages enough to attract native workers from elsewhere? Should we instead welcome immigrants who are willing to meet economic needs that Americans no longer seem inclined to, substituting their dynamism for ours? Cowen doesn’t say.
Toward the end of this short book, Cowen offers a big-picture vision of what’s to come. It’s a fascinating if necessarily speculative exercise.
He suggests that the end of complacency may not be a pretty thing to witness. In fact, the surest way to restore dynamism might be a “leveling event”—such as an economic collapse or a devastating war—that returns everyone to the same playing field with nothing. Cowen points out that the highest economic-mobility rates are often found in countries that are poor or unstable.
Cowen stops short of predicting deep and widespread societal disruption, but he does think the status quo can’t hold. He points to evidence that the American people are mad as hell and won’t take it much longer. The Ferguson riots are one sign (regardless of what one may think of the narrative that racist white cops routinely kill black males who pose no threat). Another is the discontent on campus, which since the book was written has expanded to include a destructive riot at Berkeley and an assault on a professor at Middlebury, both in protest of appearances by conservative speakers. There are also indications that crime is starting to rise again after a quarter-century of decline.
The elephant in the room, of course, is the Trump ascendancy. “Make America Great Again”—is that a call for revolution; or is it complacency on steroids, a desire to travel back in time? Cowen doesn’t quite answer that question, but he certainly sees the connection between Trump’s rise and the trends he identifies. “In the absence of a dynamic and compelling vision for America’s future,” Cowen writes, “people will, in fact, turn to less-positive visions.”
And even if November’s election results don’t show that the people are rising up, at least one aspect of our complacency is bound to end sooner or later: government spending can’t be on autopilot too much longer because if those “nondiscretionary” programs don’t change we’ll go bankrupt. Cowen expects we’ll see a crisis before we see reform, and he’s likely correct, given that neither political party shows much inclination to control the debt. But when the crisis hits the country will need to have an adult conversation about the proper tradeoff between taxes and entitlement benefits.
It’s possible that certain kinds of complacency inevitably lead to crisis. In the realm of international relations, for instance, Cowen suggests that the more some countries value peace, the higher the temptation for other, more violent countries to take advantage of them. He suspects rising instability around the globe might be one thing that rouses America from her slumber.
Is there a happier way for complacency to end? Cowen does suggest some brighter outcomes—mostly relying on forthcoming technology—and they’re a good note to end on. The rise of automation could finally disrupt long-stagnant industries or make it easier for families to take care of more children. Driverless vehicles and better mass transportation (think Elon Musk’s vacuum-tube Hyperloop) could help more people get jobs in the highest-paying cities. Clean, cheap energy could get us building major projects and exploring space again.
Behind these competing visions, of course, is the eternal question of whether history is a tale of continuous progress or rather a procession of cycles. Probably both are true in different ways. We could very well see further technological advancement in the years ahead, but also the return of the violence and unrest of the late 1960s.
Robert VerBruggen is managing editor of The American Conservative.