It’s a well-known phenomenon that a society’s elites can sometimes fail badly, running their countries right off into the abyss. We think of the First World War, the Maginot Line, the Great Depression, the Soviet Union, socialism, the War in Vietnam, the recent Global Financial Crisis and so on. The question I’m interested in is whether we are living in one of those times when our elites have failed us so badly – and on a global basis – that the consequences for world order may be dire, indeed. Elites, however dismal their failures, don’t go quietly, and whatever it is that fills the vacuum might not be all that attractive.

But, first, what’s an “elite?” Back in 1956, in his influential book, The Power Elites, sociologist C. Wright Mills identified American elites as politicians, military officers, and businessmen. That’s almost laughable today, as those are precisely the folks who are the primary targets of contemporary elites.

America’s elites aren’t, and really never have been, defined by who their parents were or what social class they were born into or what universities they attended or how much they make or are worth. Our elites have always been simply people who were in a position to make a major difference in the direction of American society. Maybe, in the 1950s, Mills was right. But today’s elites are quite different, since the positions in society that matter are different today.

As a result, America’s “elites” are now found in such places as the media; university professors, presidents and deans; executives of the large NGOs (including foundations); the massive entertainment industry; high-level government bureaucrats; think tanks; opinion journals; and so on. These people are elites because they are in a position to disseminate their opinions and to enforce compliance with them. No general, CEO or senator would dare publicly contravene an opinion once our elite opinion makers have deemed the debate closed.

But elites in other parts of the world come from different sectors. In Europe, for example, the elites are those folks who graduated from a tiny group of elite schools and who have spent their lives in the state and global bureaucracies that oversee European affairs. In India the elites are the politicians, bureaucrats and intellectuals associated with the vast Gandhi dynasty/Congress Party that has ruled India almost continuously since its independence sixty years ago.(1) In China, meanwhile, the elites are those families who stood by Mao in his darkest hours, on the Long March, a military retreat from Jiangxi in the south to Shaanxi in the north, a distance of some 6,000 miles.(2) Only 10% of the fighters who left Jiangxi made it to Shaanxi.

The countries just mentioned – the US, Europe, India, China – represent almost half the total population of the world and the vast majority of its economic and military might. If the elites in these places fail, the consequences will be staggering. In my next post we’ll take a look at how our elites are doing.

(1) We often speak of India as “the world’s largest democracy,” but “the world’s largest monarchy” would be more accurate.

(2) Actually, there were several “long marches” involving several different Communist armies, but the one from Jiangxi to Shaanxi, guided by Mao himself, is the best-known.

Next up: Our Floundering Elites, Part 2: How They’re Doing

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Please note that this post is intended to provide interested persons with an insight on the capital markets and is not intended to promote any manager or firm, nor does it intend to advertise their performance. All opinions expressed are those of Gregory Curtis and do not necessarily represent the views of Greycourt & Co., Inc., the wealth management firm with which he is associated. The information in this report is not intended to address the needs of any particular investor.

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