Social Niches
Alexander Liss
American government developed welfare
policies with best intensions to protect most vulnerable members of society as
single mothers, chronically unemployed, etc. It tuned to be a disaster – in
some parts of the society many generations were living on welfare, young women
produced kids out of family to be able to receive welfare payments and in some
cases it was economically beneficial to break a family at least on paper to
receive welfare.
Welfare payments were not sufficient to
sustain living - black labor market emerged, where people were working off
books.
It was difficult for a person to get on
welfare the first time – brokers emerged, who use their knowledge and
connections to overcome this barrier for a fee. On the way the segment of
government, which was handling welfare, was corrupted.
When large number of people became enrolled
in welfare, they become important political constituency – politicians started
representing their wishes, thus perpetuating and enforcing the status quo.
Economic barriers to getting out of welfare
emerged. A person, who dared to move from welfare to work, faced decline in
living standards – absence of health insurance, low wages. Businesses were
suspicious of people, who were on welfare, of their work habits, honesty,
attitude, etc. and were reluctant to hire them.
Eventually, the government had to
restructure the welfare system to prevent the most egregious abuses and to
encourage people to start working instead of relying of welfare.
It was called “unintended consequences”,
but it should be called inaptitude in setting and managing a new social system.
This happened because people who did it did not understand the mechanism of
social functioning.
They did not understand the phenomenon of stable
states of society – social niches.
In many cases, division of a society into groups is
obvious. Sometimes such division is legally enforced, but in modern society,
boundaries between groups are rather invisible, but real nevertheless.
This division precipitates the phenomenon of “social
climbing”, where a person makes considerable efforts to move to a more
advantageous group. This is done through substantial achievements in business
or culture, through strategic marriage, etc.
Economic and social crises often cause massive
movement on opposite direction, into less advantageous group.
When a person belongs to such social group – a
Social Niche, a person develops perception of higher “worthiness” of own Social
Niche in comparison to other Social Niches. It could look strange or even
ridiculous to an external observer, but this is normal behavior. This is simply
reflection of stability of the Social Niche.
A Social Niche is stable, when it takes
considerable efforts to get into it or to move to another Social Niche.
Barriers between Social Niches are economic and psychological.
A Social Niche of rich people is obvious
and it is a subject of fascination in a market-based society.
Rich people are those, who do not need to
work to sustain comfortable life now and in a foreseeable future. Usually they
own some assets and businesses, which provide steady stream of income or they
have some other means to receive such stream of income.
Being rich does not mean being happy and
does not mean not working. Many rich people are unhappy and some rich people
work a lot, sometimes more than not rich people do.
Rich parents make sure that their children
belong to the same Social Niche and it is very difficult to get into it from
outside. This makes the Niche extremely different from other Niches.
Stupidity and unforeseen events, as
socio-economic crises, kick some members of this Niche out. For some this
becomes a severe psychological trauma, some find energy to clime back.
Rich play important role in a market-based
society. They develop new desires. These desires are satisfied at considerable
cost. Some of these desires propagate to the rest of the society in slightly
modified form. To satisfy them a new mass product or service is created. Thus,
market expands and overall wealth of the society grows.
In middle ages in
In democratic society one does not legally
inherit the membership in a group of people who hold political and economic
power, but usually it happens through connections and careful preparation.
The entry barriers are high, but with skill
it is possible to get there. In a market-based society, Powerful are often
rich, but their desires and behavior is mostly defined by the drive to expand
their power.
In any society there is a Bottom Niche – a
place easy to get it and difficult to get out. In the
There is a group of people, who have little
reserves.
They
are subsistent farmers, who starve, when crops fail. They are workers, who
starve, when they cannot find a job for a couple of month.
This life at the edge often shapes their
perception and behavior.
In a civilized society, there is a support
system, which softens the suffering in cases economic downturn, but they do not
change the subconscious awareness of the danger and limited room to maneuver.
When they sell fruits of their labor, they
have to accept low prices; when they sell “the use of skills and time”, they
have to accept low wages.
When the wealth of the society grows, they
participate in it only partially. When it contracts, they are first to suffer
from it.
Those who manage to accumulate reserves
acting in the ways unusual for members of this Social Niche manage to migrate
to another Niche, but this is economically difficult – incomes in this Social
Niche are barely sufficient to cover needs; wages and prices on shelter, food,
transportation, etc. are at balance exactly at the point, where wages are
barely sufficient to cover people’s needs (in that particular society and that
particular time).
Usually, members of this Social Niche are
numerous and their marginal existence and consequent resentment attracts
demagogues seeking political power. The society often reacts to it with a
mixture of measures of appeasement and oppression. This is a vicious cycle,
which stabilizes the Niche and destabilizes the society as a whole.
The better solution would be enabling migration
from this Niche to other, more advantageous Niches of the society. This is done
through good education of children, which facilitates social mobility, and through
perpetual adult education, which allows acquisition of new skills and
improvement of income. The focus should be on elimination of the basic
limitation, which causes this Social Niche; the focus should be on improvement
of ability to compete.
There is wealth disparity between Niches
and it grows. There are a few causes for it.
Expansion of the wealth of the society has
periods of exponential growth. If one takes two persons with different initial
wealth, the gap in wealth between them increases in absolute and in relative
terms, in such periods. This is the nature of the market. The healthy way to
decrease this gap is not through depriving the one, who has more, but through
exploiting new opportunities with higher rate of expansion by one, who has
less.
In the periods of contraction (recessions),
due to mistakes or bad luck, some have their reserves reduced or even wiped
out. This pushes them into a less advantaged Niche, from which it is difficult
to clime back. A recession causes mass migration toward less advantageous
Niches – redistribution of number of people between Niches and hence relatively
fewer people in advantageous positions.
This is how the market-based society
functions. It is needed to prevent accumulation of mistakes.
Hence, in a market-based society one has to
pay close attention to reserves, protect them and minimize their use at
economic contraction.