The surge in inequality since 1980 has been driven from above, by the top 10 percent, and even more so by the top 1 percent and the even smaller fractions of pharaonic wealth. The other 90 percent have not all been impoverished, but they have been abandoned. This has given rise to a bitter journalistic and academic literature in the Global North, an interesting counter-position to consultancy and development bank dreams of the “rising middle class” of the Global South.

To stiffen bourgeois resolve in this moment of crisis and liberal self-doubt, Torben Iversen and David Soskice’s Democracy and Prosperity (2019) presents a homage to “advanced capitalist democracies” (they show more deference to capitalism than to democracy, which is held responsible for the inequality). “The essence of democracy,” they aver, is “the advancement of middle-class interests.”

Iversen and Soskice, both prominent institutional economists, argue that the middle class is aligned with capital via two key mechanisms. One is “inclusion into the wealth stream” created by capital accumulation. The other is the welfare state: the tax-and-transfer system ensures that the gains of the knowledge economy “are shared with the middle classes.” It is precisely this “inclusion” and “sharing” between capitalists and the middle class that is found by recent inequality research to be terminating.