Working-Class Liberalism and Community Elbow Room

First, who counts as working class

He redefines it, and the redefinition is doing serious work:

“If you’re getting your income from the labor market mostly, not from capital, not from your parents, then in my definition you’re part of the working class.”

This is enormous — it takes in nurses, electricians, software engineers, journalists, small-business owners, and (he says, laughing) tenured MIT professors, “the edge of the working class.” Cowen’s challenge is fair: if the category includes almost everyone, does it mean anything?

Acemoglu’s answer is that the unifying feature is not a shared job or a shared culture but a shared structural position — your income depends on your labor being wanted. And he accepts the cost: the class so defined is wildly heterogeneous, “a very diverse set of skills,” which is precisely why he needs communities to have their own practices and values. The elbow room is not a nice-to-have. It is required by the breadth of his own definition.

⚠ The book defines it much more narrowly, and this is the largest single discrepancy the book check turned up. Chapter 10, four sentences into the argument:

“By working-class… I mean people without college degrees in blue-collar or service sector jobs, a group that includes much of the native-born white population who have increasingly turned away from liberal policies.”

No nurses-to-MIT-professors continuum. No structural-position criterion. A conventional demographic category, and one defined against the college-educated — which is the axis the whole book runs on, from the “meritorious college educated and the rest” through post-industrial politics in Chapter 7. Cowen’s challenge in the interview is that the broad definition includes almost everyone and so means nothing. On the book’s definition the challenge doesn’t arise, because the definition is narrow and unremarkable. The expansive answer Acemoglu gives on air is improvised, and it makes his own project sound vaguer than it is. Everything below about heterogeneity requiring elbow room follows from the interview’s definition, not the book’s.

The structure, as I read it

The critical asymmetry: exit and voice are floor rights. A community can adopt practices you dislike; it cannot stop you leaving, speaking, or organizing against them. That is what makes local variation liberal rather than merely local.

My best guess at his example

He doesn’t give one, so this is construction, flagged as such. The domain where his framework has the most content is work:

This fits the automation half of the interview exactly. His example there is that German manufacturers redesigned jobs around robots to create new tasks, while American firms mostly did not — a difference not in the technology but in who had standing to shape its introduction. (The interview says “Japanese, Korean and German carmakers”; the book says German manufacturing, with Japan and the Nordics as comparable cases and no Korea — see below.) That is community-level agreement doing real economic work, and it is why he wants unions reconstituted rather than abolished, including the teachers’ unions he criticizes.

Applied elsewhere, the same shape gives you: national floor on what every child must be taught and every child’s right to leave; local discretion on how schooling is organized. Or a national floor on speech; local variation in norms about it.

The hard case — avoided in the interview, not in the book

What happens when a community’s agreement is illiberal — restricting women’s work, enforcing religious conformity, excluding outsiders? Cowen doesn’t press it, and the transcript leaves it hanging. The book does not. Chapter 10’s second challenge is titled Freedom versus Community and is about nothing else; see below.

From the book

Chapter 10, Working-Class Liberalism, is the chapter this page was reconstructing. It organizes the whole programme as five challenges: community values; freedom versus community; building voice and citizenship; shared prosperity in post-industrial society; and drains for the twenty-first century — his shorthand for public services and the safety net, from his own line that “the crisis of liberal democracy is also a crisis of drains and dole”.

The floor is named, and it is four items. Not the single “meaningful individual freedom” the interview implies:

“Liberal democracy must strive for maximum tolerance but should never accept community traditions and practices that suppress basic individual freedoms, including freedom of expression, freedom to acquire education, equality before the law, and the right to exit the community.”

Exit is singled out — “an essential recourse for escaping, if one wishes, from peer pressure and other norm-based impositions on individual choices” — and then, unusually, bounded in the other direction too: “this doesn’t imply that billionaires could invoke the right to move out of a country in order to avoid paying taxes. The right to exit should be there to protect individuals against the cage of norms, not for financial arbitrage.”

And he works the hard cases rather than gesturing at them. Sati and female genital mutilation as the clear violations. The Amish and the Hutterites curtailing children’s schooling, and Sharia law in certain British Muslim communities, as cases where “the American, British, and Canadian governments have acquiesced to such abridgement of individual liberties.” American states’ rights as the domestic parallel. Then, deliberately, a case that goes the other way — a community holding anti-gay views:

“If these remain in the realm of pure speech, without turning into incitement of violence or an abridgment of other people’s basic freedoms, the principle should be the same one that the ACLU applied in defending the neo-Nazis’ freedom of expression… It should be actions and real restrictions that matter, not intolerant words and thoughts.”

That is the dividing line the page above says he needs and does not draw: acts, not attitudes. It is a real answer, and it is a demanding one — it obliges a liberal society to tolerate community views it finds repellent while refusing community practices far short of repellent.

The elbow room is federalism, and the page guessed the wrong domain. The construction above built the example around work. The book builds it around governance:

“Fourth, public service provision has to be married with the community-level self-government agenda. Federalism is a useful tool in this regard… Federalism also allows different local units to pursue their own policy preferences which supports community-level experimentation.”

The reason is the Chapter 2 argument, restated in Chapter 10: “Experimentation is powered by variation. If all communities had the same values, true experimentation would not materialize.” Local variation is not a concession to communities that disagree; it is the mechanism by which a society learns anything.

But the workplace reading is not wrong — it is the fourth challenge. Chapter 10’s shared-prosperity section is squarely about who has standing to shape technology at work, and it does want unions reconstituted rather than abolished:

“Working-class liberalism should additionally give support to the labor movement so that unions can protect workers against abuses by powerful employers and rise to the challenge of promoting a pro-worker AI agenda. But the labor movement itself must change in the process as well… bargaining just for higher wages and hoping automation will be slow is not a realistic strategy. In fact, when there are plenty of automation technologies on offer, most companies would meet higher wage demands by choosing more automation.”

— with a specific and unusual ask: “union leaders themselves becoming sufficiently well-versed in AI and digital technologies to be effective in these negotiations,” leveraging the fact that “the workers themselves best understand their work, certainly better than tech companies do, and often better than their management does.”

So the honest correction is that elbow room and the workplace are two different challenges in his scheme, not one. Community elbow room is Challenges 1 and 2 and cashes out as federalism and a rights floor. Job design is Challenge 4 and cashes out as union bargaining over the direction of technology. The page above welded them together; the book keeps them apart, and the rights floor does no work at all in the workplace argument.

The carmaker claim, verified — with three corrections. Chapter 6 supplies it:

“German manufacturing firms have introduced industrial robots considerably faster than their American counterparts. The number of robots per industrial worker in Germany is about twice that in the United States. But German manufacturing companies must negotiate with worker representatives and unions when making these choices, and their blue-collar workers are often very well trained… while in the 1990s and 2000s American companies deployed digital technologies, mostly for automation, displacing and laying off blue-collar workers whenever they could, German manufacturing firms adopted a very different strategy. When introducing new technologies, they retrained their blue-collar workers for technical and supervisory occupations.”

The outcome claim holds: “robot adoption in Germany was not associated with large employment drops. Blue-collar work declined, but there were concurrent increases in technical occupations.” And the mechanism claim — that this was institutional, not technological — gets its sharpest support from within Germany: “in establishments where labor was better organized, there were less steep employment declines, and more pronounced efforts to reallocate blue-collar workers to technical tasks.” More robots, fewer layoffs, because of who was in the room.