Market Mad House

In individuals, insanity is rare; but in groups, parties, nations and epochs, it is the rule. Friedrich Nietzsche


The Problem of the American Gentry

Strangely, one of the biggest impediments to progress in America is something few observers notice: America’s gentry. If you need a definition of gentry Tides of History podcaster Patrick Wyman provides one in a great essay for The Atlantic.

“Gentry are, by definition, local elites,” Wyman writes. “The extent to which they wield power in their locality, and how they do so, is dependent on the structure of their regime.

Wyman identifies America’s gentry as the property owners and business people who control local regional economies and politics throughout the United States. For example, coal mine owners in West Virginia, McDonald’s franchisees anywhere, car dealers, real estate developers, and industrial farmers in places like Wyman’s hometown of Yakima, Washington.

Whither the American Gentry

“The American gentry stands at the apex of the social order throughout huge swaths of the country,” Wyman writes in The Atlantic. “It shapes our economic and political world thanks to its resources and comparatively large numbers, yet it’s practically invisible to the popular eye.”

Wyman is right and wrong about the American Gentry. He’s right about the Gentry’s power and influence. He’s also right about our media and popular culture’s failure to examine the gentry and its power.

However, Wyman is wrong about the power of the American Gentry. Today’s American Gentry is smaller, poorer, and far less powerful than the American Gentry of the Mid-20th Century.

The Incredibly Shrinking American Gentry

Technology and economic centralization have diminished the power and wealth of America’s Gentry. America’s Country Clubs have fewer members and those members who remain have less money and influence than their grandfathers.

For example, the Everytown USA Country Club of 1971 would have contained a newspaper publisher, two or three car dealers, a couple of bankers, TV and radio station owners, a couple of real estate developers, a trucking company owner, a department store owner, and a few factory owners. Today’s Everytown Country Club could contain a real estate developer and a couple of car dealers.

In 2021 Everytown, the newspaper, now owned by a New York hedge fund, barely survives. Google and Facebook took all the advertising revenue long ago. The department store closed shortly after Walmart opened in Everytown in 1985.

Meanwhile, the local bank is a branch of a national monster bank. The monster bank branch manager views the local gentry as a bunch of golf-playing bums who are not worthy of credit. That’s a far cry from the 1971 banker, who was always ready to extend a line of credit to his golf buddies, and overlook the occasional overdrawn account or missed loan payment.

The TV and radio stations, now owned by large corporations, barely survive on minuscule advertising revenues. Meanwhile, the factories not driven out of business by Chinese competition are owned by international corporations. The remaining factory and TV station managers, and the newspaper publisher, are middle-class technocrats who would not be welcome at the Country Club.

The Investor Class vs the American Gentry

I think Wyman does not understand America’s modern economy. If he did, he would know that the American Gentry is in terminal decline. That’s not necessarily a bad thing the Gentry is usually the most racist, corrupt, reactionary, and authoritarian group in the typical American town.

In particular, technology and a rising investor class threaten the American Gentry. For example, Google and Facebook are killing newspapers and TV and radio stations by sucking up all the advertising revenue. Similarly, Netflix and Disney+ are taking all the TV station’s viewers. Even car dealers are now threatened by CarMax and Carvana.

Similarly, a rising class of national investors is slowly gobbling up all the Gentry’s wealth. Corporations and hedge funds now own most local and regional newspapers, for example. Today’s newspaper publisher is a corporate apparatchik whose major role is cost cutting.

Additionally, new technologies such as the large solar farms being developed by billionaires such as Warren Buffett and Elon Musk now threaten the Gentry’s wealth. The solar farms will drive coal mines, which provide fuel for power plants, out of business. The profit from the solar farms will go to investors in New York, Miami, San Jose, or Chicago, not the local gentry.

The investor class is even coming for agriculture; America’s most conservative and gentry dominated industry. Microsoft (MSFT) founder Bill Gates and his ex-wife Melinda, are America’s largest owners of farmland. The Gates family owned 242,000 acres of farmland in July 2021, The Land Report estimates.

Moreover, Gates is one of just many investors buying up farmland. Chinese investors now own 192,000 acres of American farmland, Politico estimates. Chinese investors own so much US farmland that there is now political pressure to stop the practice, Politico reports. However, two other groups of foreigners European and Canadian investors own millions of acres of American farmland.

The investor class is slowly taking all the Gentry’s wealth. Hedge funds now own businesses, such as mobile home parks and newspapers, that used to support local family fortunes. Hedge funds are even buying up rental homes, historically one of the gentry’s primary sources of wealth. Similarly, Warren Buffett’s Berkshire Hathaway (NYSE: BRK.B) is buying up car dealers.

Large corporations such as Amazon (AMZN), Disney (DIS), and Alphabet (GOOGL) are stealing the Gentry’s markets and money. Disney, Netflix (NFLX), Alphabet’s YouTube, and Amazon Prime are slowly squeezing out traditional television and centralizing TV in a few giant digital outlets.

Consequently, many Gentry find themselves one failed deal, or bad season, away from ruin and a return to the middle class. America’s towns and suburbs are now full of bitter ex gentry.

For example, the schoolteacher, or insurance salesman, whose father or grandfather owned the local newspaper, lived in the biggest house in town, and drove a Packard. The school teacher or salesman now drives a Toyota, lives in a normal neighborhood, golfs at a public course, and resents his situation.

American Gentry Under Siege

The American Gentry finds itself in a bizarre situation. In some ways, the Gentry’s power and influence is greater than ever.

The local professional classes of college educated experts and intellectuals that often served as a check to the gentry’s power have collapsed. People such as the crusading newspaper publisher, the liberal clergyman, the union leader, and the progressive politicians who resisted the gentry’s power are long gone. The regional middle classes have moved off to the suburbs of California, Georgia, Texas, the Northeast, Florida, and Virginia in search of jobs.

Hence, the Gentry has finally gained or regained control of local and regional politics at a time its economic power is disappearing. The local businessman has influence over his Congressman. Yet, that influence is not saving his business from technology.

Many local business owners cannot get a bank loan, but they can always reach their U.S. Representatives on the phone. The gentry expresses its resentment towards growing irrelevance through political action.

I think this paradox explains the Gentry’s attraction to Donald J. Trump (R-Florida) and his MAGA movement. Trump promises to restore the America of the 1950s – the time when the Gentry was at its most powerful. For example, the Donald’s hollow promises to reopen West Virginia’s coal mines.

Similarly, the Gentry is increasingly hostile to Wall Street, Silicon Valley, China, and Hollywood. Forces they correctly see as threatening their power.

This explains the Trump boat parades and the efforts of politicians such as US Representatives Grace Meng (D-New York) and Dan Newhouse (D-Washington) to block Chinese land purchases. It also explains the hostility that conservative intellectuals, such as Fox News talker Tucker Carlson, and politicians such as US Senator Josh Hawley (R-Missouri) have towards both Wall Street and Silicon Valley.

Should we Fear the American Gentry?

One of the gentry’s historical roles that Wyman ignores is to trigger civil war. For example, it was the slave-owning gentry of the South that formed the Confederacy and launched the American Civil War.

Similarly, the Spanish gentry backed Franco’s Nationalists in the Spanish Civil War. In addition, the English Civil War was a battle between the Royalist gentry and rising Puritan capitalist classes.

More recently, some members of the American Gentry participated in the bizarre Cosplay riot at the US Capitol on 6 January, 2021. Vanity Fair even claims private jets hauled some rioters to Washington.

Gentries launch civil wars because they fear losing power and authority. Indeed, Civil Wars often become battles between the gentry and rival elites. For instance, we can explain the American Civil War as a battle between Northern Industrialists and bankers and Southern planters.

Indeed, you can view the Emancipation Proclamation as an act of economic warfare against the Southern Gentry. President and former corporate lawyer, Abraham Lincoln (R-Illinois) was trying to destroy the Southern gentry by depriving of its source of wealth: slaves.

Hence, one way to view America’s culture wars, the conflicts around Trump, Republican voter suppression efforts, the filibuster battles in the US Senate, and even January 6 is as rearguard actions to preserve what power, wealth, and influence America’s gentry has left. That should scare us because historically, gentries only relinquish their power at the point of a gun. Remember the American Civil War?

America’s Gentry is going down fighting, and that should scare us. A gentry in decline is a dangerous class that will fall prey to demagogues and extreme ideologies. Hence, the gentry’s decline partially explains the Trump phenomenon.

We need to be afraid because history shows rival elites will take extreme measures to rid themselves of troublesome gentry. Japan’s Meiji Restoration wiped out the Samurai, the Japanese gentry, for instance. In the 20th Century, Lenin and Stalin exterminated the Russian gentry, for example. Mao exterminated the Chinese gentry, Ho Chi Minh exterminated the Vietnamese gentry, and Castro drove the Cuban gentry to Miami.

We need to understand the decline of the American Gentry because it is one of the principal conflicts of our age. How Americans deal with the gentry’s decline could determine our political future.