We live in a world where class distinctions are not defined by what you might be born into, but by data and the ability to control it.

I am certainly not saying that being poverty stricken in America or being Dalit in India as a class distinction does not exist…it certainly does, but at least in America there are many factors that have helped to alleviate the absolute crushing disposition of being poor. Capitalism itself has done quite a bit to reduce poverty in the world. Yeah…people are going to disagree with this, but the data is very clear and unambiguous. Innovation, automation, and the ability to profit from freely chosen paths in life has done wonders. The American Dream is not dead, at least completely. A Pew research study rather significantly suggests that the “Share of U.S. aggregate Income” between 1970 and 2018 has fallen significantly for those in the middle income ranges from 62% to around 44%, and has fallen slightly from 10% to 9% for the lower income classes. This suggests to me that while there are outliers, that is people who do rise from the lower income scales to the higher income scales the mathematical chances of it happening are becoming less and less. If you are inclined to do a study that asks whether the American Dream is still alive, the answer they give will be completely dependent on who is asked.

What about the people who are already in the most affluent groups? The top 5% of families has seen their share of income growth explode. The old adage that the rich are getting richer and poor are getting poorer is now more true than ever in America. There is some value in subscribing a certain amount of income inequality blame to the distinction that some businesses were declared essential and others not during the Covid era. I am inclined to think however that while there was some movement during Covid from more affluent to less affluent, it was mostly because some of the biggest companies could not pivot fast enough to online ecom and work from home scenarios. This is a trend that had been happening for some time. I think the businesses that had already pivoted before Covid are mostly doing ok, but those who had not already taken the plunge failed miserably. I am always perplexed by Sears…the company that started the catalog business not being able to pivot at all to ecommerce. I grew up in Duluth in a house that was built around 1900 that was ordered from Sears Roebuck. All of the building materials, the plans, the workers to build it came from a Sears catalog. Sounds like ordering something from Amazon.

The restaurant and service industries are probably doing the worse, but the incomes of most of those workers were already defined to be low paying. This will affect the trends by making what was already low pay even lower. It will have no effect on the broader trends of income inequality that has been going on for some time. Why is that? Some might say that manufacturing in America has died so the base of the middle class has had the proverbial rug pulled out from underneath them.

I am however inclined to believe with no sure evidence that the IT industry is the new middle class and if you have the skills and the education to be in the IT industry then as a rule you and your family were doing ok. The IT bastion of middle classness however is slowly dissipating. Automation has allowed a very small number of people to administer and control a great number of machines. In days of yore it would have taken a small army of admins and engineers to manage those servers. I am hazarding a guess by saying 1/20th the number of workers are required to run a data center today than were required 5 years ago. This is just a guess…it is probably more like 1/50th, but I don’t know for sure. The cloud has fundamentally upset ALL IT goodness. For good or bad this is the reality.

I am espousing a hypothesis that might be wrong to a degree, but I think more likely is correct. In today’s world a big factor in determining whether you have a good chance of moving up the socioeconomic ladder is to have some sort of relationship with the data hoarders. You know them as Facebook, Google and their ilk.

A few years ago the intellectual capital required to obtain entry into an IT career was relatively modest. Some small amount of programming skill, some knowledge of the OS and perhaps a bit of skill with Networks. This is an oversimplification to be sure, but it allowed a very large number of (mostly men) to become part of the American dream. This allowed them to support their families and lead a modestly comfortable life. To be sure there are many IT jobs available but I am going to make an unproven assertion and say that the skill set required and the flexibility to obtain the necessary skill set is much more demanding than it was several years ago and if there is anything that Covid has done, it has shown the data hoarders that the physical location of workers is mostly irrelevant. We are now competing against the skill sets from any number of countries and our schools are not in the business of fast change while industry is moving at lightning speed. These changes are precipitated by the endless pursuit of processes to monetize data, obtain data, clean data, derive insights from data. The irony of it all is that this is data that you produce by your activities in the world. Not just as you browse the web. The data barons of the world were the first to develop ways to monetize your activities. Quickly they set about cementing their position in the world. Like the lumber barons or the oil barons they were the first to pick the low hanging fruit. To be sure…the jobs that are being provided by the robber barons are well paying jobs. The income inequality between the CEO and lower paid employees is beyond gross so it doesn’t upset the inequality numbers within a particular company, but in general compared to the rest of the population it does. All you have to do is develop the skill set, develop a relationship with the data barons that gives you access to the data, and be comfortable with a state of affairs that maintains a status quo where the barons control and own the data that you produce. If you follow the rules, life will be ok…no matter where you live. All you need is access to a network. Starlink is waiting.