Class and peak oil

[Lord Beria3]

Been thinking recently about how that most dreaded of things, the British class system may be impacted by our energy driven economic impacts of Peak Oil.

Before I start, what’s the state of the situation now…

http://www.wsws.org/articles/2010/jan20 ... -j06.shtml

The Office of National Statistics has the following…

The survey estimated total UK wealth, including private pensions, as ￡9 trillion in 2006-08. Property wealth and private pension wealth each accounted for 39 percent, ￡3.5 trillion each, while financial and physical wealth each contributed 11 percent, ￡1 trillion each.

The median household wealth amounts to just ￡204,500, including private pension wealth. Half the population had this amount of wealth or less. Without private pension wealth the median household wealth was just ￡145,400.

The poorest 10 percent of households had a negative total net wealth, owing more on mortgages and other loans and debt than their properties and other goods are worth.(Before economic crisis, almost certainly more now)

The wealthiest 20 percent of households had 62 percent of the total wealth, including private pensions

The wealthiest 10 percent have more than 44 percent of all the wealth.

The conclusiion:

The lion’s share of wealth is increasingly dominated by a narrow sliver of society comprised of the super-rich and layers from the upper middle classes.

For middle to lower classes whose wealth is overwhelmingly property, this is historically overvalued and once this is factored out of the equation are not much better of than the bottom half of the population.

Peak oil could affect things in different ways. Shares and property bubbles and pensions are surely unsustainable, which will affect the wealthy parts of society... but the bottom half of the population are already sinking.

[contadino]

There is a very big difference between wealth distribution and class.

[Eternal Sunshine]

Interesting question, although you're assuming that wealth is the defining element of class. I often have quite a heated debate with my sister about class. She firmly believes herself to be working class, whereas I think of myself as middle class. We were brought up in the same household, why do we see things so differently? It may have something to do with money - we were quite well off when we were growing up. I however have never really had any money as an adult, and don't own my own house. But I still feel that I am middle class. (I don't see that as good or bad).

Peak oil & class though.... maybe PO will be a great leveller, but I think unfortunately it will probably result in differences being excentuated.

[jcw]

This final paragraph is interesting and a little surprising to me. So a lot of poor households in London mean it is on average not far from the poorest in England.

London, the British capital, home of the City, was only a little wealthier than the North of the country. Partially because of an enormously inflated housing market, London has the nation’s highest rate of non-property owners. Median assets in the capital amounted to a median wealth per household of just ￡173,400. Despite containing some of the wealthiest districts in the country, London is also home to an enormous working class. The poorest English region was the North-East, where the median wealth was just ￡168,200. The North West and Yorkshire were only marginally wealthier. These regions, historically reliant upon manufacturing, have been laid to waste over the past 30 years by a deliberate policy of de-industrialisation.

[RenewableCandy]

There is a very big difference between wealth distribution and class.

Quite. The expressions "Brass but no class" and "Class but no Brass" spring to mind. (It is important to pronounce the quantities in these expressions so they rhyme with "mass" and not with "arse" )

[Lord Beria3]

Class is a complex subject, a semi taboo in our society and a mix of social values, income, background, education among other things.

However, I would argue that if you are wealthy, it is difficult to maintain that you are 'working class', although Paul Mccarthy tries , despite being a near-billionaire.

For the purposes of this debate, I would argue that there is a broad correlation between wealth and social class.

From the statistics, it would imply that around 1% of the population (traditional landed aristocracy, foreign superrich and new rich) belong to the superrich layer and own a considerable portion of the Uks overall wealth.

A small but privaliged upper middle class elite of bankers, lawyers and other professionals own a large minority of the countries wealth. This layer tends to send its offspring to private schools, own homes over a million, enjoy good private pensions, have financial assets like bonds, shares etc.

A larger layer of affluent middle class, not quite as well-off as the above layer, own much of the rest of the nations wealth, and are more based on the value of housing.

Regarding peak oil, the superrich will become poorer, but as long as they put some of their assets into secure classes like land, they will be fine.

The upper middle classes, who own property in places like Kensington and Chelsea, Bath, Oxford, Cambridge, Edinbourgh, Winchester and Clifton in Bristol along others live in areas of affluence. These traditional towns/cities will always remain valuable, even in the future. Similarly, while some may struggle in the future, as a class they should be ok.

The broader layer of 'Middle England' have a less rosy future. Many are in middle type jobs or in the public sector. Their wealth is focused on a inflated housing bubble and their pensions are modest, even without the potential economic problems relating to pensions in the future.

I see this larger layer splintering... one layer will thrive in the future (maybe they will be in the green sector), others will struggle and sink down... losing their 'middle class' lifestyle.

Politically, these voters tend to be marginals and thus politically important, aka Mondeo Man.

The rest of the countries wealth is divdied between the lower-middle class/working class and the underclass (who don't really have any wealth, except in a negative way)

the lower middle class is a sub-division of the greater middle class which constitutes the largest socio-economic class

In terms of Peak Oil, I think the these latter two are the ones that will suffer most with Peak Oil, as they have little or no financial cushion as the economic affects of energy scarcity starts to smash them in the coming decade or so.[/img]

[jonny2mad]

I think lots of people will be as kunstler calls it the formally middle class , Id say the soon to be unwanted eaters or new landless serfs or slaves .

pretty much unskilled for doing anything useful ,angry and resentful looking around for people to offer them the good old days .

I see really big class problems in the future people have a huge feeling of entitlement their going to be mighty disappointed .

actually Im going to edit this because I see worse than just disappointment thats just the start and will just lead in to the general collapse and die-off

[emordnilap]

The lion’s share of wealth is increasingly dominated by a narrow sliver of society comprised of the super-rich and layers from the upper middle classes.

Well I never! Shouldn't this be in the 'news' section (486 AD archive)?

[Andy Hunt]

The lion’s share of wealth is increasingly dominated by a narrow sliver of society comprised of the super-rich and layers from the upper middle classes.

Well I never! Shouldn't this be in the 'news' section (486 AD archive)?

[Lord Beria3]

This guy put it better than me, he refers to the US, but the same principle applies in Blightie...

What if the US Government is peak oil aware and aggressively working to mitigate its effects ?

What form would this take ?

Well first and foremost given the US its a large oil producer and peaked several decades ago.
If a mitigation effort was and is in effect then it would have started with US peak dealing first with
the problem of increasing imports.

Moving into the future one would expect that what ever policies needed to mitigate peak oil would already have been in effect and grown out of successful mitigation of US peak.

This suggests that the US at least has already dealt with peak oil and the major policy decisions are well in the past certainly they will be tweaked as needed but BAU already includes a fair portion of our policy response to peak oil.

Therefore peak oil is not a problem and need not be addressed by some sort of radical changes. Its for all intents and purposes a solved problem.

Thats not to say increasing efforts to mitigate peak oil won't happen just that they will happen within our current framework. Certainly the changes are fairly slow but so far at least they have been effective barring a recession here and there.

Now of course over the last several decades the middle class by almost any metric has been steadily impoverished a more aggressive response to imports esp oil imports could change this situation. Thus a more aggressive mitigation of our energy situation and imports in general would go a long way to reversing the steady decline of the US middle class. As peak oil becomes more problematic the plight of the middle class will likely worsen. However this is making the assumption that the decline of the middle class is perceived as problematic I'd argue that nothing at all suggests that impoverishment of the middle class is considered a problem. We will bottom out at world prevailing wages and I'd assume the belief is from then on out global wages will rise uniformly once imbalances have been erased. By world standards Americans are incredibly overpaid this has to correct with our move to globalization.

Indeed this impoverishment fits fairly well with peak oil as it allows the continued concentration of wealth even as the average person becomes more impoverished. Expansion to the global markets more than makes up for the fall of the middle class.

Thus I'd argue that mitigation of peak oil is well established and the policies already in place. The concern shown on the oildrum is not about peak oil itself but the dawning realization that the deck is heavily stacked against the middle class and peak oil is certain to hasten the collapse of the middle class.

But the card are already played the response is in action the train has left the station the horses have left the barn. Use any saying you wish but its clear to me that peak oil is really not a problem and thus there is simply no reason to treat it as one as long as the destruction of the middle class is an acceptable outcome.

My thinking has evolved a little recently regarding this decade. I think this decade is going to be a gigantic rebalancing of energy and financial flows from the West to the East where growth will continue in Asia but stagnate in the West.

Thus, growth areas for the future in the West will be centred on the emerging markets world, benefiting financial groups, services and manufactoring exposed to the the BRIC+ growth story.

The levelling down of the global norths middle class at the expense of the aspiring BRIC middle class will fuell widening inequalities in the West, BUT barring a anather financial implosion, BAU will continue for the Twenties.

[RenewableCandy]

That's as may be, but if you (as a country) impoverish your middle class you all too often end up with an ungovernable situation. Look at Iraq: they want a new regime up-and-running, they've got the power-brokers and most of the population's still there, but they've no-one whatever "in between", to help rebuild and run the infrastructure (physical and social) necessary for a stable country.

Also with an impoverished middle-class, you sabotage your tax income. We (I'm unashamedly middle class) do have some uses, y'know

[contadino]

Also with an impoverished middle-class, you sabotage your tax income. We (I'm unashamedly middle class) do have some uses, y'know

I'm middle class too, but pay no tax whatsoever (not VAT, not income, not local taxes, not road tax, not fuel tax, etc..)

[RenewableCandy]

Also with an impoverished middle-class, you sabotage your tax income. We (I'm unashamedly middle class) do have some uses, y'know

I'm middle class too, but pay no tax whatsoever (not VAT, not income, not local taxes, not road tax, not fuel tax, etc..)

Wot, not even on your violin-case ?

[Keepz]

l

The Office of National Statistics has the following…

The survey estimated total UK wealth, including private pensions, as ￡9 trillion in 2006-08. Property wealth and private pension wealth each accounted for 39 percent, ￡3.5 trillion each, while financial and physical wealth each contributed 11 percent, ￡1 trillion each.

The median household wealth amounts to just ￡204,500, including private pension wealth. Half the population had this amount of wealth or less. Without private pension wealth the median household wealth was just ￡145,400.

The poorest 10 percent of households had a negative total net wealth, owing more on mortgages and other loans and debt than their properties and other goods are worth.(Before economic crisis, almost certainly more now)

The wealthiest 20 percent of households had 62 percent of the total wealth, including private pensions

The wealthiest 10 percent have more than 44 percent of all the wealth.

The conclusiion:

The lion’s share of wealth is increasingly dominated by a narrow sliver of society comprised of the super-rich and layers from the upper middle classes.

Which of the facts you quote justifies that "increasingly"?

[kenneal - lagger]

There is a very big difference between wealth distribution and class.

Quite. The expressions "Brass but no class" and "Class but no Brass" spring to mind. (It is important to pronounce the quantities in these expressions so they rhyme with "mass" and not with "arse" )

Only if you're lower class. If you're upper class (or from the sowf), it rhymes with arse, as in glass.