* There is a well-established folk theory about elites, shared, more or less, by the elites and the non-elite. Here is a quotation of Larry Summers, a member of the elite by any criteria: “There are two kinds of politicians,” he said: “insiders and outsiders. The outsiders prioritize their freedom to speak their version of the truth. The price of their freedom is that they are ignored by the insiders, who make the important decisions. The insiders, for their part, follow a sacrosanct rule: never turn against other insiders and never talk to outsiders about what insiders say or do. Their reward? Access to inside information and a chance, though no guarantee, of influencing powerful people and outcomes.”
Along with this folk theory comes a suspicion that the elite operates according to the ethic Alasdair Macintyre once described as “the morality of the public-school prefect. Its principal virtues are loyalty to the group and the cultivation of a corresponding feeling that there are really no limits to what you may do to outsiders.”
Given the ubiquity of this image of the political world, and the visibility and power of elites, one would think that elites would be a major focus of scholarship and debate as well as teaching, if only to debunk the folk theory. It has not been, and indeed one observes a kind of denial about elites in academic circles…
* Combining elite studies with economics is also now crucial, not merely because of the power of business leaders, but because of the relation between the goals of business and the ideological commitments to globalism and universalism that are shared with the rest of the elite, including, and perhaps especially, the academic elite.
* the problem that elites face in staying in control in the face of the fact that they are a tiny minority whose interests, especially interests in the distribution of wealth, are opposed to those of the rest of society. They continue in power because they can ally with other classes, typically the middle class, to create institutions that have the effect of redistributing wealth in ways that benefit the allied class.
* the old strategies of class alliance no longer work, together with the new fact of a novel and emerging kind of elite power held by corporations and bankers: the power to disinvest in whole countries, holding the nominal political leaders hostage. The two facts are connected. The power that economic actors can exert over states severs them from their former class alliances, and sets their former allies against them.
* The core problem is elite stability: the risks are elite stagnation through closure and elite factional conflict. These are endemic problems for elites. They are faced with a generic difficulty that is a constant threat to elite cohesion. Different elite factions, like different classes, benefit or are harmed differentially by the redistributive institutional arrangements that are set up to assure the alliance between the elite and a sufficiently large nonelite class to create stability. These alliances need to be maintained and are costly.
Maintaining the appropriate balances between elites and their non-elite allies is a difficult task which will also inevitably divide elites themselves. The historical winner among the possible arrangements has been, until recently at least, an alliance between the elite and the middle class, and especially the upper middle class. What’s in it for the middle classes? As SET put it, the elites “make society safe for profit” (209). Stable property rights, protection, and the freedom to do business in a predictable legal environment without onerous taxation is pretty much the formula, or has been. The elite also makes some room for members of this class to enter. The middle classes, in turn, deal with and mollify the lower classes, producing stability.
* The elite, however, can make this alliance with the lower classes as well, and has more to offer: the wealth of the middle class. There is always the possibility of what in the Obama era in the United States was called an “upstairs downstairs” alliance between the elite or factions of the elite and the lower classes against the interests of the middle classes. That fact helps keep the middle class in line. And this omnipresent possibility of new alliance with the elite produces an odd dynamic in relation to democracy. On the surface, there should be a conflict between elites and democracy. An oligarchy, after all, has to live in fear of being overthrown. But an elite, if it is functioning properly, benefits from democratization, precisely because it provides more alliance possibilities for the elite. It extends the number of people who benefit from the actions of the elite, and who will support it. And it reduces the reliance of the elite on a single class. Democratization enables playing groups off against one another, while retaining elite cohesion.
* So why are elites in trouble now? Why is there populism in advanced societies? Globalization, meaning the mobility of money and production together with relatively free trade and border-crossing financialization, are enormously beneficial to the elite, producing more inequality and “losers” in formerly closed or favorably situated national markets. It also gives new power to corporations over states.
* The only real threat to elite power is elite factional conflict. Given the sea of discontent, it is possible for an elite faction to ally with a discontented non-elite group. And, if there has been a period of stability in which the practice of managing these conflicts in the interest of the elite has fallen into disuse there are concerns, from the point of view of the elite, over the ability to manage intra-elite conflict. But there are no looming conflicts of this kind. The folk theory of the elite, in short, is true. But the new power elite, global and globalist, is an elite freed of its former bonds to the rest of society. The new bonds are elusive. A key finding of this book is that democracy, which was once a way of holding elites accountable, has become, in the new world of globalization, a means of keeping elites in power by dividing their domestic enemies.