Middle Class — Poorer version of Rich or Richer version of Poor
In a recent podcast episode of Recode-Decode, I heard writer Anand Giridharadas briefly talk about — how the middle class in a country perceives itself, being indicative of the country’s future. If I understood it well (which I suspect), his argument was that if the middle class thinks of themselves as poorer version of the rich, it augurs well for the growth of the country. Conversely, if they think of themselves as just richer versions of the poor, it does not have a bright future. I suspect the assumption here is that they get aspirational in the former scenario and get despondent in the latter. Maybe he meant something else and probably his books have more context — this was just a brief bit in a podcast. Nonetheless, this understanding of mine (assuming it to be correct), created quite some thoughts.
- Economically speaking, this makes sense — Being aspirational might bring in positive energy, animal spirits would be released and the overall growth might be better. However, economic growth is not all, ain’t it?
- Beyond economics, I think Anand mentioned it in a way of the rich having progressive values (like women’s empowerment) while the poor not having such progressive values. In this case, if the middle class models themselves based on the rich, progressive values spread and it is good for the country.
- However, in terms of culture, it is difficult to even define what is good/progressive and what is bad/regressive. Let us take a scenario of ‘late evening partying culture’ — Broadly speaking, let us assume that the rich consider it good/useful/acceptable while the poor may not even be able to afford it and (therefore?) in any case consider it bad/unacceptable. What is the middle-class supposed to do? Are they supposed to emulate the rich, consider themselves as poorer versions of the rich and start partying? Or consider themselves richer versions of the poor and continue to not ‘party’, even if they can afford?
- Consider ‘conspicuous display of wealth’. Let us say a person in the middle class can now afford to buy a car (or some such thing considered a rich man’s thing — I am writing this in India, circa 2018). Should he/she consider a brand/model favored by the rich, stretch one’s budget a bit and at least buy the lowest end variant of it? Or should he/she buy the model that best fits their budget? I see the former (buying the brand popular with rich) as ‘seeing themselves as poorer versions of the rich’ and the latter as ‘seeing themselves as richer versions of the poor’.
- Similarly, I see this playing out in people’s smartphone purchases. People buy at least an iPhone SE/5s (India — 2018) versus an Android phone with higher specs, because iPhones are the rich man’s thing. Are these people the ‘seeing themselves as poorer versions of the rich’?
In a related way, I hear people talk about the “middle class” mentality — wherever we do a penny-wise pound-foolish behavior. Am not able to say if these both are the same though.
Another related personal mental model that I associate with this model is from Ben Franklin’s biography by Walter Issacson — Apparently, Ben Franklin and his virtues become popular in public opinion in some decades and they fade away in others. The reason for this is — when everything seems good with the society and most people are happy (for example: United States right after WW2) , they look forward to good things in life and Franklin’s virtues fade away from public memory. However, when things are bit dull in a society and people’s hope for the future is dim (for example: United States after Great recession of 2008), they look forward to ideas on how to turn their life around and Franklin’s virtues become popular. I am not sure if there can be a direct correlation between these — When Franklin’s virtues are popular, it means the middle class behaves like richer versions of the poor and when they are unpopular, they behave like poorer versions of the rich. Probably, depending on how the psyche of the nation was when the demographic generational cohort (like: Baby Boomers, Millennials etc.) grew up, their behavior is one of ‘poor rich’ or ‘rich poor’
When I was in Class-VIII, there was this elocution contest that I participated in. I came third at the state level while a classmate of mine came first — It was a bounty for our school, 2 of the top 3 prizes. First prize meant that the person who won it, participated in the national level competition in New Delhi. A teacher of ours, who coached both of us told me after the event that I missed out on the first prize because of ‘lack of ambition’. Another thing he had strikingly noted was how we had tagged our ‘show & tell’ display sheets (this was pre-PPT days — even OHP with laminated sheets were rare). I had used a punching machine and modest file tag (see picture above) to tie them together while my classmate had spiral bound it. He said such things create a difference in perception and ultimately affects the result. He did not say this directly but seemed — “You look happy to let go of the first place and a chance to go to New Delhi — what are you afraid of?” (Side note — Both that classmate & I have had our ups & downs through college/jobs and can be considered to be on equal footing in our life/careers 20+ years later, so there is no conclusion to draw per se)
I struggle with that till now. This thought comes up in my decisions all the time — Buying an apartment (2BHK versus 3BHK; High-end builder versus mid-tier builder), Buying a car (Lowest end luxury brand versus High-End budget brand), Restaurant for anniversary dinner, School for my child and so on!! In most (all) cases, I choose the ‘Richer version of poor’ version but the doubt lingers if my life successes would be better if I choose the other — Abundance versus Scarcity mentality if you will.
