The shift from agricultural to industrial production also marked the shift from estate to social class system in Europe. Social class systems are based on one's economic position in society, measured by wealth, income, and prestige.

Wealth refers to a person's assets (savings, investments, properties) while income accounts for wages and salaries. Unlike the two previous systems, social class offer more chances for social mobility, which qualifies it as an open system. According to studies, it takes “five to six generations to erase the advantages or disadvantages of a person's economic origins” (Newman 330, 2006). Thus, although changing one's social class is possible, it is not always easy. One's social class can be determined by both ascribed (gender, race, ethnicity) and achieved (occupation, education) status.

Although economics is an important factor of one's social class, social networks are also an important component (Domhoff 4, 2006). It is not just our wealth and income that determine our class, but the people we associate with help determine our social class. These networks are normally influenced by our education and type of occupation.

Educational attainment is measured by the years of education completed and types of degree garnered, while income and level of occupational prestige is used to measure occupation. The Occupational Prestige Scale measures how much respected and coveted an occupation is based on how society's deems it worth and importance. Based on surveys, physicians, lawyers, college professors are at the top of the scale, while waiters/waitresses and garbage collectors are at the bottom. Combining occupational prestige, income, and education is a person's socioeconomic status.

In Max Weber's (pronounced VAY-ber) assessment of social class, he analyzed life chances or the opportunities available to certain groups as a determining factor of class. Access to health care, education, employment are all determined by one's social class. Belonging to a certain class also entails certain privileges and advantages. A blatant example of how social class inequality manifests itself in everyday life is in the airplane. The difference in treatment between economy class,business class, and first class is a good example of these privileges. More than comfort, people who sit in economy class are more at risk of Traveller's Thrombisis,or Economy Class Syndrome. In 2000, a 28 year-old woman died of deep-vein thrombosis (DVT) after a flight from Sydney to London. DVT, a pulmonary embolism or blood clot which forms in a vein, and usually in the legs, works its way in to the heart or lungs causing sudden death (BBC 10/23/00). Doctors believed that it was sitting in a cramped plane for a long period of time, which caused DVT.

Karl Marx (1818-1883) is an political economist, sociologists, humanist, and revolutionary. He is credited for the ideological formation of communism and for analyzing the sociological effects of capitalism. Marx is an economic determinist. He believed that economist structures determine social relations. It is important to keep in mind that communism is an economic structure and not a political one. There is a tendency for people to equate Marxism with dictatorships and the USSR. This is erroneous. Communism and capitalism are forms of economic organization not political systems.

Marx was writing during a critical economic transition in Europe. The shift from and agricultural and feudal society to capitalist industrial one resulted to unprecedented social change. Stratification in feudal societies was based on an estate system. Peasants worked on land owned by the lords and there was little social or geographic mobility. Feudal markets operated on subsistence economy, meaning, peasants harvested and produced food for their own needs a not necessarily to sell (Crone 21, 2003). Land ownership was also concentrated within the aristocracy. Peasants were tenants or serfs were tied to their land for sentimental reasons, either their families have worked on the particular land for generations and have an allegiance to their masters. Land was also not seen as a commodity or a material good that could be sold.

Currently, we have very little attachment to land and view real estate as a way to make money. In feudal times, this was not the case. Land properties did not have the same economic and cultural values that we have now. There were familial attachments to land and not to mention that the value of land depended on its use. In contemporary US society, land values can increase or decrease independent of what can be produced in the land. Real estate prices are not exactly dependent on how much agriculture can be produced by a certain plot of land.

In terms of labor, feudal society relied heavily on ascribed status rather than acquired status such as education or skill. Concepts such as ancestry were important in determining one's place in life. This type of labor is contingent on the fact that peasants were tied to land. In essence, “descent rather than market forces determined who should do what: work has been allocated in advance to the social group into which one was born (Ibid., 29).” Labor was also tied to the household. Household and villages were generally self-sufficient, so there was very little economic integration and interdependence. The peasants learned their trade at home and skills were passed down from parents to children.

Industrialization and capitalism disrupted the ordered society during under feudalism. Industrialization “is the process by which societies are transformed from dependence on agriculture and handmade products to emphasis on manufacturing and related industries. This process occurred first during the Industrial Revolution in Britain between 1760 and 1850 (Kendall 8 2005)."

Industrialization changed people's relationship to the market, land, and labor. It also changed the role of the government and the household in society. The growth and mechanization of the textile industry was the first step towards industrialization.

Textiles made of wool resulted to the “transformation of arable land into pastures for sheep grazing (Kloby 27 2004).” This meant the displacement of the peasants who have worked on the same land for the same lord throughout feudalism. During feudal times, common lands or lands that were owned privately, but wherein other people had traditional rights to use land for livestock and farming were also closed off because of the enclosure acts. This social disruption and inhuman treatment of the peasants did not go unnoticed. In Capital, Volume 1, Marx wrote how:

“From 1814 to 1820 these 15,000 inhabitants, about 3,000 families, were systematically hunted and rooted out. All their villages were destroyed and burnt, all their fields turned into pasturage. British soldiers enforced this eviction, and came to blows with the inhabitants. One old woman was burnt to death in the flames of the hut, which she refused to leave... “(Chapter 27, Capital, Vol. 1).

With nowhere else to go, these displaced peasants flocked the urban areas, and were transformed into the wage laborers of the capitalist economic system, or the proletariats. Capitalism is an economic ideology in which profit, the acquisition of wealth, and supply and demand dictate the exchange of goods. In capitalism, the means or modes of production (MOP) are privately owned by the bourgeoisie or the capitalist class. The means of production are the tools and materials used by labor to make and produce their products. For example, the MOP of a factory worker making shirts are: sewing machine, the building and land where the factory is located, thread, cloth and other materials she needs to execute her job. These materials are owned by the capitalist or the bourgeoisie. Notice how the proletariat uses these materials, but they do not own them. Another example is a receptionist working in an office. The telephone, computer, desk, office space, building are the secretary's MOP and these are not owned by the secretary or the proletariat. For Marx, one of the key differences between communism and capitalism is the ownership of the MOP. In communism, the MOPs are communally owned.

In a feudal society, labor is based on heritage and at a certain level, the peasants worked for themselves. In capitalism, laborers sell their work for wages to the bourgeoisie. Skills and education become an important criteria for employment and there is more room for social mobility. For the bourgeoisie, however, they can multiply their wealth without the necessary skills for the task. For example, a bourgeois can invest in a restaurant without learning how to cook. Moreover, he/she can accumulate wealth from the restaurant without having to work in the restaurant or be there physically. The possibility of accumulation of wealth is without limit, since money can exponentially grow, at least for the capitalist class. On the other hand, the laborer, is limited by the hours of the day he/she can work.

In a nutshell, the shift from agricultural and feudal to industrial and capitalism economies meant that people had to leave their homes to work in factories. During agricultural times, people produced their food, now they had to work and buy food in order to subsist. This was a major sociological change. People now had to work for wages. This might seem "common sense" to us since this is what we are used to, but our way of living wasn't always the norm.

In this new economic process, there is now the risk of getting fired from the job and not having enough money to buy food. In theory, people in the feudal system had more security because they produced their own food and were not forced to migrate to find jobs. Tradition dictated social relations, not the unpredictability of market forces. The shift turned peasants to laborers and from producers of their own subsistence to consumers.

Capitalism relies on the market forces of supply and demand and competition as the basis for innovation and wealth. In The Wealth of Nations, Adam Smith talked about the invisible hand of the economy. Smith states that in order for capitalism to reach its potential, the market should be left alone by the government or any exogenous interference. The invisible hand refers to Smith’s analysis that the market is self-regulating. This is sometimes referred to as the survival of the fittest economic mentality. For example, in a capitalist system, if a corporation is not making profit, governments should NOT try to give the company incentives for it to stay afloat; rather, if the company is not profitable, it simply means that it has to dissolve. The same can be applied to people. If a person does not have the foresight to acquire skills that are needed for the future and finds their job outsourced, then society is not responsible for the worker's situation. In pure capitalism, concepts such as social safety nets are seen as making people lazy and irresponsible. In theory, this weeding out process is believed to result in efficiency and competition among producers and workers. In the end, competition will benefit the consumers and all of society--products will improve and prices competitive. The 2008 economic crisis is challenging the notion of leaving our economic future to the uncertainties of the market. The bailout of the auto industries and banks in the US is in essence, protecting society from the forces of markets. Under the Trump administration, the concept of "buying American" is contrary to the principles of capitalism. Allegiance in capitalism is not to country, but to efficiency and profit. People should buy products based on what is the best option, not out of patriotism. The same is true for corporations. Companies shouldn't stay in a country out of allegiance.

Smith was writing about capitalism as an ideology. In reality, the impersonalized and unforgiving qualities of capitalism does not bode well for labor and capital alike. The United States has a highly capitalistic economy, but the US market is not free from government interference. The invisible hand needs a little nudge from time to time. There are various ways a government can interfere in the economy:

Subsidies: these are grants given by the government to companies in order to reduce the cost of production and/or reduce the prices. This is sometimes referred to as “Corporate Welfare”. One industry in the United States that receives a significant amount of subsidies are the agricultural producers. In order to compete with cheap food prices from other countries, the US subsidizes US farmers. In US society, there is a stigma against people who receive money from the government if unemployed or unable to provide for their needs. Corporations, however, do not seem to share the same disdain. The federal government gives out $125 billion a year in corporate welfare (Barlett and Steele 104, 1998). Generally, corporate welfare is seen as a public good by giving money to corporations, since they can provide jobs and essential for development. On the other hand, giving money to private individuals in need, even though they end up spending the money (whether to buy necessity items or luxury goods), which in turn stimulates the economy is considered a hand out.

The notion that corporate welfare creates jobs and is now being challenged. In Barlett and Steele's expose on corporate welfare, they provide examples of huge tax breaks and incentives initiated by cities and states, which did not result to the profit anticipated.

Tariff Barriers: Tariffs are taxes imposed on imported goods. This is a strategy used to protect domestic industries. For example, Vietnam makes cheap shoes that sell for $10 a pair wholesale. The US government will impose high tariffs on these shoes so that prices will increase, thereby protecting the domestic shoe industry. It would be impossible for a US company that gets its materials and makes the shoes in the US to charge $10 for shoes wholesale because of the higher standard of living in the country. As a consequence, consumers pay more. Some see this however, as a way to protect US jobs. For Smith, tariff barriers are disincentives for US companies. In the end, the the decrease in level of competition will compromise quality and increase prices.

In the capitalist economic mentality, lay offs, the firing or employees, bankruptcy, are not the central concerns. The rational is that another company or industry will fill the void left behind by a company that tanked. Thus, social services that serve the unemployed or those that have been victimized by the harsh competition of the market are unnecessary and inefficient and will make people reliant on services. Inequality is also an inherent component of the system. To keep up with certain lifestyle, cheap labor is necessary.

It was the level of inequality and system of exploitation that led Marx to believe that capitalist, as an economic system was too destructive to survive. Marx concluded that inherent in capitalism is a class struggle between the proletariat and bourgeoisie, which will eventually lead to a communist revolution. The core difference between capitalism and communism is the ownership of the means of production and capital. In a communist structure, MOP and capital are communally owned.

Marx believed that the proletariat would become aware of their oppression and would eventually overthrow the existing system.

Unlike capitalism, the goal in communism is not profit, but equality and the elimination of exploitation. Interestingly, the idea of public ownership has materialized within contemporary capitalist system. The Open Source Software Movement was a reaction to proprietary software where source codes were protected and privately owned. In open source software (OSS), the source codes are available to the public. An example is Open Office. This is an alternative to Microsoft Office, which includes versions of Word, Excel, Powerpoint, etc. This can be downloaded free of charge online.

Open source can also be “free” in a sense that development is made in a collaborative and collective manner. Users all over the world can help improve existing software applications and develop features. An example of this is Firefox and Wikipedia. Firefox is an alternative to Microsoft's Internet Explorer (IE) and Apple's Safari and. Like Open Office, Firefox can be installed free of charge and I'm sure most students know that information from Wikipedia is free of charge as well.

Marx's idea of equality and vision of cooperation motivated communist revolutions all over the world. In the late 80s with the fall of the USSR, capitalism seemed to have triumphed over communism. There are various reasons why communism has not taken root as Marx envisioned. Firstly, the US offensive line against communism during the Cold War has stunted the spread of the ideology. Also, Marx did not anticipate, in conceptualizing class division, the rise of the middle class. The middle class helped balance the inequality within society and helped preserve the status quo. For the middle class, life is not too hard and they have just enough to keep them satisfied.

One development in our understanding of capitalism is Fordism. The basic concept of Fordism is to adapt to the increased ability to mass produce with mass consumption. With technological advance, it has become faster and cheaper to produce goods. Factory production, characterized by division of labor, specialization, and standardization has allowed companies to produce goods in a short span of time. The ability to mass produce, however, is meaningless if markets did not expand accordingly. Thus, one of the central tenets of Fordism is to increase wages so that employees are able to but goods as well. By paying workers more, their ability to buy goods makes mass production profitable.

Building on Marx's dichotomous class system (proletariat and bourgeoisie), neo-Marxist philosophers have added other class systems. The petty bourgeoisie and lumpenproletariat are subdivisions of the 2 classes. The petty bourgeoisie includes small business owners and managers. Managers are not owners of the MOPs, but may share the same interest as capitalists class. The lumpenproletariat, on the other hand, refers to workers who have been rejected by the system and have become “unnecessary” (Andersen 216) either due to technological advance or some form of downsizing. The presence of people who are unemployed or looking for jobs has diminished the bargaining power of the working class. These reserve army of labor are always ready to fill in the jobs of the proletariat who threaten the status quo. There are always people willing to work for lesser pay and in more dire conditions.

Our current understanding of how capitalism affects society and individuals is still greatly influenced by Marx. Read the “Manifesto of the Communist Party” and use these questions to better understand the arguments. Keep in mind that Marx is quite poetic and at times abstract in his writing, so take your time in reading this piece.

Compared to communism, socialism's goal is not the elimination of private ownership; rather equal access to basic needs such as food, shelter, and health care are the end goal. Socialism, like communism however, rejects an outright acceptance of the free market system and believes in the role of government in cushioning individuals and companies against the vicissitudes of capitalism. Examples of socialist countries are Western European countries such as Norway, Finland, Great Britain, France, and Japan and China. These countries have universal health care systems, a generous welfare state, and government owned and run companies. For example, in France, the government still owns a majority (85%) of shares in the largest electricity company, Electricité de France.

As mentioned in our assessment of capitalism, the US, although a capitalist, is not free from government intervention or socialist principles. The concept of Medicare, health insurance for senior citizens, are socialist projects. In an ironic twist, these social programs and initiatives such as the public school system, Medicare, Medicaid, and Social Security although contrary to pure capitalism actually help preserve capitalism in the US. These programs help soften the negative social consequences of capitalism, which allows capitalism to thrive.

Unlike Marx, Weber's conceptualization of social class is not limited to the means of production. Weber moves from a strictly economic determinist definition of social class. Weber added to Marx’ materialist and economic analysis of class by including status, prestige, and political power as determinants of social class. For Weber, material wealth and economic power is only one of the three sources of power. Weber classified three types of power and prestige:

Political power but no wealth: An example would be Martin Luther King or Mahatma Gandhi. These two political leaders and social activist were not wealthy in financial terms, but they exercised a great deal of political influence.

Prestige but no wealth: Mother Theresa is an example. She was known for her charity work, but was not monetarily rich or politically influential

Wealth but no political power: Paris Hilton is an example. She may be financially wealthy, but she has very little political clout.

One's socioeconomic status determines one's access to cultural, political, and economic power in society. In the US, it is taboo to talk about social class since our idea of the American Dream and the notion that through hard work and individual achievement anyone can rise to the top of the social strata. As mentioned previously, however, it is not that easy shifting from one social class to another. As much as we would like to think that hard work is all it takes, the Horatio Algers stories are possible, but rare. The dot.com bubble in the late 90s and early 2000 has catapulted a number of young tech savvy computer programmers and entrepreneurs such as Google's Larry Page and Sergey Brin and Facebook's Mark Zuckerberg. In their success it is easy to forget that Page and Brin were graduate students at Stanford University, and Zuckerberg went to school at Harvard. Bill Gates also went to Harvard and Yahoo! founder Jerry Yang also went to Stanford. Not only are these success stories rare, but these men were by no means from the bottom of the socioeconomic ladder. Thus, although these people may have changed their social status dramatically, they were most likely in the upper middle or even upper class to begin with.

In Domhoff's Who Rules America? Power, Politics, and Social Change, he chronicles that the upper class not just as an economic group, but an “interlocking” network, which controls politics, military, and culture in the US. Among other industrialized countries, the US has one of the most unequal distribution of wealth

source:Graph from Mother Jones | Data from The World Wealth and Income Database

The bottom 90% has not enjoyed the same economic growth as the richest top 1%. The real winners since the 1980s is the top 0.01%, with a growth of 322%.

For conservative economists, the concentration of wealth is advantageous for the economy. President Ronald Reagan's economic policy or what is referred to as reaganomics rests on the fundamental ideology of trickle down economics. The idea is that with concentration of wealth,there is an increase in capital, which is necessary for businesses to grow. As businesses thrive with the availability of capital, wealth will trickle down. Reagan also promoted the deregulation of the economy and lowering taxes and government spending.

The housing meltdown and credit crisis of 2008, however has made government rethink its policy of deregulation and capital concentration. The excessive CEO salaries , low interest rates, and predatory lending that were prevalent in the 80s and onwards were instrumental in causing the crisis (Morris 2008). As a result of concentration of wealth, too few people had too much money to put in the bank and too many people relied on loans. Generally, people with limited resources spend their money when they get it and rich people that already have enough to survive invest or save it. The excess of money in the banks was partly responsible for the negligible lending practices.

In Media Magic: Making Class Invisible (1995), Mantsios observes how the media has made the middle class the “universal” class. According to Mantsios, the media rarely acknowledges the existence of the poor, and in their rare coverage, the poor are usually blamed for their plight. In ignoring the lower class and lumping the working class, the middle class, and the upper class as one category, Mantsios claims that the middle class has come to represent a majority of Americans, which is a myth.

People who claim to belong to the middle class do not seem to reflect reality in terms of income and wealth. What Mantsios is pointing to is that what it means to be a middle class is a “state of mind”. In a Pew Research Center study released on April 9, 2008 on the middle class more than half (53%) of Americans are self-proclaimed as middle class, a number that has been consistent for the past decades. However, what the research has found is that for those who claimed to belong to the middle class, what it means to be middle class varies by age, race, gender, education, location, and work status.

According to the Pew Research, “median family income for whites who say the are middle class is just over $56,000—nearly $10,000 more than for self-identified middle class blacks. Even bigger income disparities occur along generational lines. Adults between the ages of 30 and 49 who say they are in the middle class earn slightly more than $65,000, nearly double the median family income for those older than 65 and about $27,000 more than the median for those under the age of 30 (31).”

Americans seem to have a distorted view of the middle class. In the study, people who consider themselves as a part of the middle class have diverse incomes and incompatible definition of what constitute a middle class.

Not having a more consistent definition of the middle class as a group has social repercussions such as voting patterns. In What's the Matter with Kansas: How Conservatives Won the Heart of America (2005) Thomas Frank explores why middle class and poor Americans are for politicians that are contrary to their interests as middle and working class. The traditional Republican economics consistent with reaganomic (tax cuts, deregulation) benefit the rich, and Frank questions why the middle and working class are voting for policies and for a party that is inimical to their class interests. He realized that these voters are not voting on their economic or class interest, but on their religious affiliation

The main difference between the middle and the working class in their educational attainment and the types of jobs they occupy as a result. The middle class is mostly college-educated while the working class perform manual labor.

he lower class or poor in the US are mostly employed part-time or are lower than subsistence-level wages (Schaefer 194). People who belong to this class are in and out of poverty. Most lower class are females and single mothers. As seen from the graphs, the lower class, just like the middle class, has not fared so well in the past couple decades.

Poverty is measured using the poverty line. The US determines the poverty rate using the threshold as specified by the Census Bureau. This shows how the number of people impoverished can be manipulated—if you lower the poverty line, the less people will be under the poverty status. The US poverty threshold is measured according to the US Census Bureau Poverty Threshold.

Among the various social classes, the upper class seem to have the most salient class consciousness. Class consciousness refers to one's sense of belonging to a particular social group. The upper class are aware of their power as a group and have formed social network ties that represent their interests (Domhoff 2006). According to Domoff, through private schools, exclusive social clubs such as the Bohemian Club, and charities, the rich have formed networks in politics and business that are beyond the reach of those outside of their circles. Domhoff takes on a conflict perspective on power and views these exclusive channels as undemocratic. The upper class understand what it means to have networks within their group and through these ties they solidify their power.

Compared to other industrialized country, American middle class have a weak class consciousness. As discussed previously, the middle class are polarized as a group and the concept of the American Dream and social mobility makes middle class a less cohesive group.

In the 2008 elections, no one has embodied this concept more than Joe The Plumber. During the campaign, Joe the Plumber was a metaphor for middle class America. His real name, Samuel Joseph Wurzelbacher, got his first spot in the limelight when he questioned Obama about his plan to increase taxes for people making more than $250,000. Apparently, Joe the Plumber was trying to buy his own plumbing business and was concerned about his tax increase under Obama's plan IF he ends up making more than $250,000 annually. Investigative reports soon revealed that Wurzelbacher owed $1,200 in unpaid taxes and a second lien was filed for $1,261 that he owes St. Charles Mercy Hospital (ABC 10/16/08). In his interviews, Wurzelbacher expressed his opposition to Social Security (US News 10/16/08). In his own words, “Social Security is a joke...You know, let me take my money and invest it how I please. Social Security I've never believed in, don't like it. I hate that it's forced on me.” Wurzelbacher also believes that taxation is a “punishment” for hard work. When asked by Diane Sawyer about progressive tax policies, a tax policy that is based on income (the higher the income the higher the taxes), Wurzelbacher claims that the rich should not be “penalized for being successful (ABC 10/16/08).”

Government run resources such as public schools, parks, police force, fire departments are public services that everyone, but especially the middle and lower class take advantage of. Tax cuts and lower government spending affects these public sources. From the conflict perspective, Joe the Plumber's opposition to these services is seen as form of false consciousness. Marx did not explicitly use the term, but it refers to the concept when members of the subordinate class are unaware of the repression and exploitation that they are suffering from. For Marxist, Joe the Plumber has been successfully convinced by society that his interests are in line with the ruling class. Whether or not this is the case depends on the economic philosophy you adhere to. If you believe in trickle down economics, such as economists Thomas Sowell (1930), Joe the Plumber will eventually benefit from concentration of wealth, but liberal economists, such as Paul Krugman (1953) would disagree. For the functionalist perspective, Joe the Plumber is an example of a person knowing their place in society, which helps maintain the status quo.

• Stratification
• Wealth
• Income
• Prestige
• Social Mobility
• Open System
• Social Networks
• Interdependence
• Occupational Prestige Scale
• Economy Class Syndrome
• Ideological Formation
• Economic Determinist
• Familial Attachments
• Capital
• Acquisition of Wealth
• Supply and Demand
• Means of Production
• Proletariat
• Wages
• Wealth of Nations
• Survival of the Fittest
• Subisidies
• Tariff Barriers
• Communism
• Open Source Software Movement
• Middle Class
• Fordism
• Petty Bourgeoisie
• Lumpenproletariat
• Reserve Army of Labor
• Socialism
• Weber's Social Class Stratification
• American Dream
• Reaganomics
• Working Class
• Lower CLass or the Poor
• Class Consciousness
• False Consciousness