A main reason for the lack of a truly global class analysis so far is the difficulty in obtaining sufficient comparable data. For instance, the individual-attributes approach relies on data concerning income inequality as an essential building block.
The economist Branko Milanovic (2011, 2016) tries to fill this gap. His latest contribution (Milanovic, 2016) represents the first exhaustive study of global income inequality across countries. While he uses the term “class” to refer to certain groups specified by his analysis, he does not engage in class analysis in the strict sense, since he is not concerned with many classical attributes of class, such as occupation, or education. The meaning of class in his analysis only pertains to groups of similar income across the globe. Nevertheless, his book is useful for the study of global class because it demonstrates the limitations of the individual-attributes approach on the global level, and is highly instructive on the structures and developmental trends of global inequality. He specifically includes historical data to analyse who has gained from globalisation and who did not.
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The first interesting fact from a class perspective is the absolute distribution of global income (Fig. 4-1). The graph uses annual household income in International Dollars in the years 1988 and 2011. The area beneath the curve corresponds to the world population in the respective years. It depicts a rather unequal distribution, with the highest peak in both years more than half way below the median. This demonstrates on the one hand how unequal the distribution of income still is on a global scale, and on the other a slight improvement in the growth of incomes around the global median. Milanovic (2016: 33) calls the group around this rank in the global income distribution the “emerging global middle class”.
Figure 4-1: Distribution of world population by real per-capita income, 1988 and 2011. (Milanovic, 2016: 33)
This picture becomes even clearer when we look at the relative gains in income for specific income levels over the last two decades (Fig. 4-2). This graphic shows that the highest gains between 1988 and 2008 were achieved by the aforementioned group around the median of the distribution (point A). Interestingly, zero gains were achieved for the group at the eighty percent mark (point B), whereas the high end of the global income distribution (point C) achieved a sixty-five percent increase in their income in the same period.
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Figure 4-2: Relative gains in real per-capita income by global income level, in 2005 International Dollars, 1988-2008 (Milanovic, 2016: 11)
So, who are the people that profited so much from globalisation? According to Milanovic, this “emerging global middle class” consists largely of people at the respective middle of the income distribution in Asian countries. Roughly ninety percent of the people in this group live in China, India, Thailand, Vietnam and Indonesia (Milanovic, 2016: 19).
Their experience contrasts sharply with the story of the group “one step up” on the global income ladder, those at the eighty percent mark. This group has greater income than the global middle class, however it consists mainly of people in the lower half of the income distribution in the “rich” countries of Western Europe, North America and Oceania.
This story confirms on the one hand the different trajectories of richer countries and middle-income countries: while the lower classes in rich countries still have a comparatively high income in relation to the world population as a whole, their position in the global distribution is stagnant at best. While most of the benefits of globalisation were accrued by the middle classes of “emerging market” economies, the lower classes of developed countries did not improve their position relative to others, and in absolute terms had no gains in their income over the last twenty years. To some extent, this confirms that the homogenising effect of globalisation, insofar as the economic growth of Asian countries raises their respective income levels, is allowing them to catch up slowly with North America and Europe. In the West, economic growth has slowed, leading to stagnating overall levels of income, decreasing the differences between these countries and the developing world to some extent.
These data also show how large the disparities are between western European and north American countries on the one hand, and the rest of the world on the other: despite tripling their
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income over twenty years in the case of China, or doubling it in the cases of Indonesia, Vietnam and Thailand, the respective middle classes have still caught up only with the lower end of the income distribution in the West. The comparison of the income distribution in selected countries depicted in Fig. 4-3 shows that an income from the twenty-fifth percentile rank in Russia, or the seventy-fifth in China, corresponds roughly with the income of the poorest ten percent in the USA. And the gap widens towards the lower positions in the global income distribution.
Figure 4-3: Global income distribution by country ventile, selected countries, 2005, in PPP (Milanovic 2011: 8)
The class position within a country is therefore of rather low significance with regard to one’s life chances in global comparisons, Milanovic concludes. On the global scale, life chances are rather defined by the country of origin, or in Milanovic’ words, by a “citizenship premium”
that the country of origin “pays” (2016: 125-137). He therefore maintains that the social conflict on the global level will continue to be fought about migration, more so than about class.
There is however one exception, depicted at point C in Fig. 4-2: the top of the global income distribution has not only made gains in the same proportion as the “emerging global middle class”, but it made these from a much higher level. Among this group, there is even some global convergence to be observed, at least amid European, North- and South American, as well as Asian countries, where the richest
This gets even more astonishing when we account for the fact that, as Milanovic does, his data massively underrepresent the truly super rich, or as he calls them, “the global plutocrats”.
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His analysis of this group is based not on survey data, but on the various lists published since 1983 in Forbes magazine. This group represents 0.001% of the global population, yet control an amount of wealth exceeding six percent of the value of the global GDP.
Milanovic argues that this cleavage is the true class conflict of the twenty-first century, as it represents a historically unprecedented concentration of wealth, and thereby power, in the hands of an extremely small group. Although as an economist he does not use concepts such as
“collective action” or “class consciousness” directly, he nevertheless discusses the political power wielded by this group. Particularly with respect to the USA, he warns against “social separatism”; that is, the withdrawal of the rich from public services, such as healthcare and education. With the rich moving towards private forms of social provisions, these pillars of social security and mobility for the lower and middle classes become underfunded, weakening the social position of these groups. Simultaneously, the middle- and lower classes in rich countries are affected by the perceived threat of mass migration, which Milanovic sees as being politically exploited by the rich through populist “diversion tactics”, channelling the political lines of conflict away from questions of distribution. In the long term, he perceives this as a danger for democracy, since it disenfranchises large parts of the population and concentrates political power within a very small group of people (Milanovic, 2016: 44, 192-211).
In conclusion, what Milanovic’s study shows in terms of the problems of global class analysis is that there is, on the one hand, a good reason for being cautious about the efficacy of class indicators from individual attribute approaches on the global level. The “methodological nationalism” with regard to class structures is in other words more than a problem of theoretical framing; rather, it is a problem of scalability of indicators of class on the global level. The persistence of such disparities in income between the developed and the developing world shows that, if we accept the premise of a global society, this society is more stratified by nation states than by class position. However, critics might argue that for exactly this reason there is no such thing as a global society, and hence sociology should stick to the well-known territory of nation states.
On the other hand, even the mere analysis of the distribution of income and wealth – an analysis of “places” in society, without any of the classical indicators for class membership such as occupation, employment status or education – demonstrates the tendency of a convergence at the top. Crucially, this convergence is not limited to the developed world, but also includes the (smaller) elites of developing countries. The geographical breadth of the power such wealth bestows to those who Milanovic terms the “global plutocrats” underlines the importance of being aware of small, but potent, potential global classes. The combination of
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huge disparities in the global distribution, with the peculiar feature of global convergence at the top, makes the case for focusing on processes of class formation rather than class structure, and for employing a class concept based on the notion of collective action.
Milanovic is not the first to make the case for examining the top tier of society as a candidate for forming a global class. His observations concur to a large extent with the thesis of the “transnational capitalist class”, which I will discuss in the next section.
4.2 A Marxist Approach to Global Class: The Transnational Capitalist Class Hypothesis
For the last three decades, a small group of scholars (e.g. Cox 1987, van der Pijl 1984, Robinson/Harris 2000, Sklair 2001, Carroll 2010, Sprague 2009) has argued, that globalization should not be understood as emerging by itself from the technological developments as the disjunctive theories of globalization suggest, or as a state-led project of American hegemony, as e.g. Panitch and Gindin (2012) would have it, but rather as a political-economic project of a fraction of the world-wide capitalist classes, who, in order to gain advantage over their competitors, escaped the boundaries of national economies by pursuing the agenda of market liberalization and the formation of transnational corporations (TNCs). They obtain their power through their positions in transnational corporations or organizations such as the WTO, the World Bank or the IMF, which also serve to deepen global economic integration and to spread globalist-capitalist ideology.
The theoretical roots of this approach lie in the neo-Marxist tradition of political economy and were formulated in response to the state-centrism of earlier Marxist analyses (Carroll 2014).
Trying to ground global class analysis in the economic realm, this approach carries with it a focus on the organisation of the economy. Therefore, it centres on transnational organizations and corporations, which are thought to be simultaneously the means of capitalist globalization and the place of class formation and reproduction for the global capitalist class.
The first concise analysis of this transnational capitalist class (TCC) was put forward by Leslie Sklair (1994, 2001), who argued that this class consists of four groups in positions of power, who exert controlling influence over the development of the global capitalist system.
These are firstly, the owners and managers of transnational corporations, secondly, globalizing state bureaucrats and politicians, thirdly, globalizing professionals and fourthly, consumerist elites in the media. He described their project as follows:
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This class sees its mission as organizing the conditions under which the interests of its various fractions and the interests of the system as a whole (which do not always coincide) can be furthered within the context of particular countries and communities. This implies that there is one central transnational capitalist class that makes system-wide decisions, and that it connects with the TCC in each community, region, country, etc. (Sklair 1994:
174)
Sklair’s conception of the transnationalist capitalist class as a “hegemonic block” steering global capitalism was in turn heavily criticised for forcing too many different groups with different economic bases and interests, such as owners of capital and salaried professionals, into one broad class (Embong 2000).
However, Sklair’s contribution is remarkable insofar, as he pointed towards a capitalist class, which was, unlike in earlier Marxist contributions, not a national one, but rather comprised of an “capitalist international”, connected across countries and unified by a common
“culture-ideology” (Sklair 1994: 177).
William Robinson and Jerry Harris (2000) expanded on this approach by positing the transnational capitalist class as a genuinely de-territorialized social formation. Since its economic base are the global circuits of accumulation, production, and consumption, Robinson and Harris argue that this class supersedes nation states, and, by exerting power in their interest through its personal connections to influential positions in government, actively constructs a transnational state. This state therefore comprises the “captured” state apparatuses of Western countries, as well as most intergovernmental organisations. For Robinson and Harris, the transnational capitalist class is not a class in formation, but rather a class in-itself and for-itself, and as such a powerful collective actor on the global level. Through Robinson’s and Harris’
reconceptualization, the analysis of a global capitalist class thus becomes aligned with the idea of globalisation as a de-territorialized force.
While these theoretical propositions surrounding the transnational capitalist class are controversial, this approach has generated fruitful empirical research into the social organisation of transnational capital.
The first strand of this research investigates the thesis of the transnational capitalist class through the lens of network analysis. These studies primarily examine the networks of corporations constituted through “interlocking directorates”, referring to the practice of members of a corporate board of directors serving on the boards of multiple corporations.
William Carroll (2010) shows, that over the period from 1997 to 2007, nationally integrated
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networks slightly declined, while a bridging segment of directors with a high amount of linkages across national borders developed. He concludes that therefore, a transnational capitalist class is “in the making, but not yet made”.
In a similar vein, Peetz and Murray (2012) examine the ownership structures of large corporations. Building on Carrol’s insight of increasing transnational social ties between economic elites, they show that the ownership of the world’s biggest corporations is increasingly concentrated in the hands of a handful of globally active financial conglomerates and interpret this form of financial capital as the material source of the power of the transnational capitalist class (Peetz and Murray 2012: 51).
However, other studies such as Heemskerk (2011) or Burris and Staples (2012) find a strong European or, respectively, transatlantic network formation, pointing to strong regional trends in the integration of a transnational capitalist class. These studies show that a transnational business community is indeed forming, although its extent (global, north-Atlantic, or European) remains a subject of discussion.
A second strand focuses on the transnationalisation of management in terms of congruence between the countries of origin of firms and those of their management. In engaging with the thesis of a transnational capitalist class, these studies follow the hypothesis that in order for such a class to exist, the group of managers controlling transnational corporations should be characterized by a form of transnational lifestyle or experience. Authors such as Hartmann (2009, 2016) or Pohlmann (2008) therefore examine to what extent the management of big corporations has the same nationality as the firm, as well as whether career patterns include positions abroad or not, thereby elevating an experience of migration to the decisive criterion for the “transnationality” of the economic elite. Most recently, Hartmann (2016) examined the CEOs of the firms on the worldwide Forbes-1000 list in 2015, and for a historical comparison the top 100 companies from the USA, Germany, France, Great Britain, Japan and China in 1995, 2005 and 2015. In addition, he includes data on the nationality of the board members of firms from 19 countries, the places of residence of the world’s 1000 richest billionaires and discusses the role of elite universities in the formation of business elites.
He arrives at the conclusion that the world’s biggest companies as well as the biggest companies of western industrialized countries are mostly run by CEOs from the home country of the firm. Only 12,6% of all CEOs in his sample are international recruits, a further 19,7%
have international work experience of at least six months, bringing the total of
“transnationalists” among the Forbes-World-1000 CEOs to 32,3% (Hartmann 2016: 56). He concludes that the global business elite is a myth, “not even visible on the horizon”. While a
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slight tendency towards northern European and transatlantic integration can be observed, and with the big exception of Switzerland, Hartmann argues that there is no sign of a truly global elite, because on the one hand, cultural ties to the home country are too strong to cut, and secondly, because the intimate relationship between the business elites and their nation states is too big an asset to lose.
The problematic point in Hartmann’s analysis lies in his assertion, that there is no global business elite without long-term global movement. He raises the criterion for global class formation implicitly to the level of the members of this group having to be “true cosmopolitans”
(Hannerz 1990), who readily shed their culture of origin in order to integrate themselves into another one. He explicitly rejects the notion the group in question fulfilling this criterion, and states that “even in these circles, one is not willing to give up on one’s native language and the habitus formed since childhood by the national culture” (Hartmann 2016: 208, translation by this author).
While Hartmann’s data surely prove that, indeed, the captains of industry are not global nomads, their characterization as quasi-locals seems a little overstretched as well. After all, the question remains, whether not moving away from the country of origin renders a manager automatically a “localist”. Hartmann thereby incorporates Robinson’s and Harris’ (2000) conceptualisation of the transnationalist capitalist class as completely de-territorialized as the benchmark for class formation. However, it is surely possible, that these managers do have a
“global” mindset, despite their status as non-migrants. Especially as they surely take advantage of the possibilities of short-term travel and global communication networks when managing the international subsidiaries of their firms. Indeed, qualitative studies have shown, that while the factual extent of the globalization of management careers may vary, the idea of “global management” represents an important organizational narrative, and serves as a legitimizing ideology for management decisions, including the appropriating higher salaries for managers (Mense-Petermann 2009, Mense-Petermann and Klemm 2009, Gottwald and Klemm 2009, Sklair 2001).
This discussion shows the potentials and pitfalls of the transposition of the Marxist domination approach to the global level. A great achievement of this line of reasoning is the conception of globalisation not as a purely systemic effect, but rather as the result of conscious collective action on the behalf of the owners of capital. Globalisation thus becomes a bit disenchanted from the nimbus of inevitability. However, the idea of the transnational capitalist class appears never quite as disentangled from the state, as the powerful prose of Robinson and