You’re rich enough, Hillary Clinton … or are you?

Daniel W. Drezner
June 23
Daniel W. Drezner is a professor of international politics at Tufts University and a nonresident senior fellow at the Brookings Institution.

Hillary Rodham Clinton is on tour promoting her new memoir, “Hard Choices.” (Jim Lo Scalzo/European Pressphoto Agency)

Back in 2000, David Brooks published a charming little book called “Bobos in Paradise: The New Upper Class and How They Got There.”  Bobos was short for “bourgeois bohemians,” representing a combination of bohemian values and bourgeois levels of affluence. In the book, Brooks deftly deployed his trademark comic sociology to dissect these new meritocrats, with their graduate degrees and six-figure salaries and conflicted feelings about those six-figure salaries.  His chapter on “Intellectual Life” still carries a powerful echo of recognition to the hardworking staff here at Spoiler Alerts.  In that chapter, he talked about the problem of “Status-Income Disequilibrium (SID),” in which truly successful intellectuals get to hobnob with the truly successful in other spheres of life — and come to a sobering realization:

In the 1950s, when intellectuals socialized mostly with each other, they did not feel the pain of their own middle-class income. The rich were remote. In those days, an investment banker went to Andover and Princeton, while a newspaper person went to Central High and Rutgers.  But now the financiers and the writers both are likely to have gone to Andover and Princeton. The student who graduated from Harvard cum laude makes $85,000 a year as a think tank fellow, while the schlump she she wouldn’t even talk to in gym class makes $34 million as a bond trader or TV producer. The loser who flunked out of harvard and never showered is worth $2.4 billion in Silicon Valley.  Pretty soon the successful intellectuals start to notice that while they have achieved social equality with these money types, financially they are inferior (p. 178).

Which brings me to “dead broke” Hillary Rodham Clinton and her extremely awkward statements (as well as those of her supporters) about money.  She’s not exactly a pure intellectual, but she is a Mandarin, which for our purposes is pretty much the same thing.  And she keeps saying very odd things about her income — most recently, to the Guardian:  

America’s glaring income inequality is certain to be a central bone of contention in the 2016 presidential election. But with her huge personal wealth, how could Clinton possibly hope to be credible on this issue when people see her as part of the problem, not its solution?

“But they don’t see me as part of the problem,” she protests, “because we pay ordinary income tax, unlike a lot of people who are truly well off, not to name names; and we’ve done it through dint of hard work,” she says, letting off another burst of laughter. If past form is any guide, she must be finding my question painful.

One can almost imagine someone telling her, “you’re rich enough” in a 2016 debate.

Why the stumbles over this question?  Let’s be clear — Hillary Clinton is doing far better than the think tank fellow in Brooks’ writing.  As Philip Rucker wrote Sunday, “She and her husband are established members of the 1 percent, leading lives far removed from the millions of middle-class voters who swing elections.”  The thing is, the world has also changed.  We now live in the Age of Piketty, where the money types are doing farbetter now than they were when Brooks wrote “Bobos in Paradise.”  Compared to those they hobnob with at affairs like the Clinton Global Initiative, they’re relative paupers.  Or, as Chris Rock would put it, the Clintons are rich — but they’re not wealthy.

I suspect that this must drive Clinton, the ultimate Mandarin, crazy with Status-Income Disequilibrium.  To paint a sympathetic narrative: This is a woman who grew up in a middle-class family but attended Wellesley and Yale Law School.  This is someone who clearly worked much harder than her husband in law school.  She worked even harder in Little Rock to support her husband both emotionally and financially even though he didn’t care all that much about money or … other aspects of their marriage.  She had to suffer the indignities of trying to have an influence on policy as first lady, even though that’s a fantastically awkward position from which to exercise the levers of power.  Her opponents drowned her and her husband in legal fees throughout their eight years in the White House. Humiliated by her husband’s scandals, she struck out on her own, first as a senator, then as a presidential candidate, then as Secretary of State.  And despite all of that effort, despite the $200,000 Goldman Sachs speeches she delivers, she’s still not as well off as the run-of-the-mill hedge fund manager.  At the same time, she likely does face a higher income tax rate, because her income does not come via carried interest or capital gains.  If she runs for president in 2016, she’s going to have to cadge enormous sums of money from these people to fund her campaign.  Does this burn her sense of how the world should work? I bet it does.

The problem is the less sympathetic counternarrative that is all too easy to construct and likely to appeal in varying degrees to the 99 percent of Americans who wish they had Clinton’s money problems..  This is the narrative that points out that despite Clinton’s elitist credentials, she and her husband lived off of the state of Arkansas for most of the years between her graduation from law school and her husband’s election to president.  In an effort to build a larger nest egg, she engaged in some financial dealings that raised some eyebrows.  She botched the one major policy initiative handed to her during her husband’s two terms, and then traded in her family name for a relatively safe Senate seat.  Yes, she was in debt in 2000, but as Matt Yglesias pointed out, “you need to be really rich to go that deeply into debt.” The wealth that she and her husband have earned since his time as president is almost entirely derived from being the most glorified “formers” in the United States.  Most of this money is earned through book advances and paid speeches because of their fame.  If Clinton is upset at her financial situation, it can only be in comparison to those in her social and professional circles.  Or as David Frum tweeted Sunday:

One way to alleviate Status-Income Disequilibrium is to try to covert your form of capital (status) into other forms of capital.  The Clintons and those in their orbit have done this, again raising eyebrows in the process.  It’s something that elites might understand and something that the rest of the country will not.  Furthermore, because of the increasing gap between the top .01 percent and even folks like the Clintons, that gap will never be narrowed unless she bought early into the “Yo” app.  So the rest of the country will look at the Clintons and think of them as being part of the One Percent, while they will look at their situation and think that they’re slipping away from the .01 percent.  And until the former secretary of state gets over her massive case of SID, these kind of gaffes will recur indefinitely.

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