The Apotheosis and Decline of the Old Middle Class: A Millsian Primer

In the genre of sociological analysis as narrative, perhaps only Max Weber's account of the genesis and transformations of “the spirit of capitalism” is more widely known than C. Wright Mills's historical sketch of the American middle classes in White Collar. In its general outlines – and Mills painted in very broad strokes – his story of the old middle class can be simply told. An engaging story, both inspiring and tragic, it also seems to be largely false.

Once upon a time in America – the time was the nineteenth century – modestly capitalized farms and businesses flourished in a rural and smalltown economy. In the main, people who were employed owned the means of production with which they worked, the definitive characteristic of the “society of small entrepreneurs.” Mills claimed that before the emancipation of slaves, as many as 80 percent of the free population who were employed owned economically productive property. Thus “the society as a whole was a middle-class society” (Mills 1951, 7). An implicit welfare function was built into Mills's analysis of the old middle class, and it may be useful to make this function and its chief assumptions explicit. Economic welfare, on which total human welfare depends, was a function of ownership of productive property in markets where exchanges were coordinated by competition and the price mechanism. This function rested on three main presuppositions: (1) property holdings were relatively small and there were no barriers to entry; (2) each economic actor controlled an insignificant market share and was thus incapable of influencing prices; (3) markets were immanently coordinated by virtue of their own structure and dynamics: it was essential to Mills's conception of the old entrepreneurial economy that it rebalanced market fluctuations by selfadjusting. Thus the economy was not coordinated politically, administratively or bureaucratically. Although the economic powers of the state were indispensable, they were limited to the responsibility of ensuring that the integrity of competitive markets was not compromised.

Mills ascribed considerable importance to the dispersion of property in the old middle class. It was the economic structure of smallholdings that underpinned the competitiveness of markets, ensuring the security of “the masterless individual,” the “‘absolute individual’, linked into a system with no authoritarian center, but held together by countless, free, shrewd transactions.”