The Fourteenth Banker Blog

August 3, 2010

Qu’est-ce que le tiers-état?

Filed under: Running Commentary — thefourteenthbanker @ 9:20 PM

During the Ancien Régime, prior to the French Revolution, society was divided into these three classes (or Estates).

First Estate

The first Estate comprised the entire clergy, traditionally divided into “higher” and “lower” clergy. Although there was no formal demarcation between the two categories, the upper clergy were, effectively, clerical nobility, from the families of the Second Estate. In the time of Louis XVI, every bishop in France was a nobleman, a situation that had not existed before the 18th century.[1] At the other extreme, the “lower clergy” ( about equally divided between parish priests andmonks and nuns) constituted about 90 percent of the First Estate, which in 1789 numbered around 130,000 (about 0.5% of the population).

In principle, the responsibilities of the First Estate included the registration of births, marriages and deaths. They collected the tithe (dîme, usually 10 percent); served as moral guides; operated schools and hospitals; and distributed relief to the poor. They also owned 10 percent of all the land in France, which was exempt from property tax.[1] The church did however pay the state a so-called “free gift” known as a don gratuit, which was collected via the décime, a tax on ecclesiastic offices.

The French inheritance system of primogeniture meant that nearly all French fortunes would pass largely in a single line, through the eldest son. Hence, it became very common for second sons to join the clergy. Although some dedicated churchmen came out of this system, much of the higher clergy continued to live the lives of aristocrats, enjoying the wealth derived from church lands and tithes and, in some cases, paying little or no attention to their pastoral duties. The ostentatious wealth of the higher clergy was, no doubt, partly responsible for the widespreadanticlericalism in France, dating back as far as the Middle Ages, and was certainly responsible for the element of class resentment within the anticlericalism of many peasants and wage-earners.

The first estates had to pay no taxes to the second and third estates.

Second Estate

The Second Estate (Fr. deuxieme état) was the French nobility and (technically, though not in common use) royalty, other than the monarch himself, who stood outside of the system of estates.

The Second Estate is traditionally divided into noblesse de robe (“nobility of the robe”), the magisterial class that administered royal justice and civil government, and noblesse d’épée (“nobility of the sword”).

The Second Estate constituted approximately 1.5% of France’s population. Under the ancien régime, the Second Estate were exempt from the corvée royale (forced labour on the roads) and from most other forms of taxation such as the gabelle (salt tax) and most important, the taille (the oldest form of direct taxation). This exemption from paying taxes led to their reluctance to reform.

Third Estate

The Third Estate was the generality of people which were not part of the other estates.

The Third Estate comprised all those not members of the above and can be divided into two groups, urban and rural. The urban included the bourgeoisie 8% of France’s population, as well as wage-laborers (such as craftsmen). The rural includes the peasantry, or the farming class (about 90% of the population). The Third Estate includes some of what would now be considered middle class—e.g., the budding town bourgeoisie. What united the Third Estate is that most had little or no wealth and yet were forced to pay disproportionately high taxes to the other Estates.

So what does this have to do with America today?  As a free post revolutionary society we have cast off the notions of nobility. While the clergy are influential, they are not a class of their own with greatly disproportionate power and privilege as during the Ancien Régime. Nor are they homogeneous in their points of view. Yet, it seems to me that this basic class structure is taking shape. For some time I have been trying to determine in our modern society which would be most analogous to the First and Second Estates of France. Here is my go at it:

The First Estate consists of the individuals that control the entrenched large corporations, including banks, that dominate the modern economy. These are a priestly class. This Estate bears resemblance to the First Estate of the Ancien Régime in the following ways. The individuals are often from America’s entrenched wealth and the continuation of their power is contingent on maintaining the established order with minimal changes. They use their power to grant special privileges, such as the low tax rates owed by Hedge Fund managers, the evasion of criminal consequences for their conduct, and their special influence over the Second Estate. Further, like the clergy of old, they are often held up as role models, moral guides, and chief benefactors of many charities and political candidates. The First Estate are also the keepers of the mystery of Neo-Liberal Economics. All threats to their power are shrugged off as socialism, a form of heresy. The First Estate is also supported by most vocal and politically organized of the clergy in the West.

The Second Estate consists of the government. This is fitting in that the government originally had a role of benevolent rule combined with special obligations and sacrifices.  In early France, the nobles were entrusted with governing authority, but it also fell on them to raise armies and fund wars from their own purse. So with authority came sacrifice. The nobles owned much of the land and had the power to extract rents and levy taxes on other landowners. But in return they had to provide sound local administration. By the eighteenth century the nobles had either left for Paris or those left in the country had degenerated into petty oligarchs. At one time the nobility had lived among the ordinary people, related to them with both empathy and responsibility and felt their fates tied to the fate of the Third Estate. Today’s US Government is a second part of the power axis, hand in hand with the First Estate in ruling over the average citizen.  The Second Estate is becoming more and more corrupt as shown in innumerable headlines and this insightful piece today. The Second Estate shuns those that would return the government to its rightful role in society, such as Elizabeth Warren. It heeds not the calls of the Third Estate for such a reformer.

The Third Estate consists of the rest of us. As in the Ancien Régime, this largest of classes includes academics, writers, most professionals, laborers, craftsmen, etc. As during the Ancien Régime, this class pays a disproportionate share of the taxes and receive no special benefits.  W-2 wage-earners get creamed. Most have no defined pension plan, pay ever more for their health care, and have little political clout. Like before the French Revolution, these citizens are divided and do not know their common interests. They are becoming impoverished by the deflation of their most important assets, declining personal income, and inflation in staples. Further, The Third Estate is becoming obsolete at the whim of the First, which is a dangerous mix, because like the French Third Estate, we have an inextinguishable hatred for inequality.

These are only some similarities and are meant to provide a paradigm for thinking about the structure of power in this country. Some will point out that there are huge and obvious differences that historians can comment on at length. It is not the differences that concern me, it is the similarities. One of the differences is that this is so large and diverse a country that it may not be possible for the Third Estate to assemble in any meaningful way. Of course, that is what the nobility thought in France as well. De Tocqueville, no supporter of the Revolution, stated that:

When the middle classes has thus been isolated from the nobleman and the peasant from them both, when a similar process persisted at the heart of each class itself and small individual groupings had formed in the Center of each of them, almost as isolated from each other as the three classes were between themselves, then it was found that the whole nation was no longer anything more than one homogeneous mass whose parts were, however, no longer linked together (paradoxically) Nothing was arranged any longer to hinder the government any more than it was to shore it up. The result was that the whole structure of the King’s greatness could collapse together and at once, as soon as the society which served as its foundation started to tremble.

So the question in the title is translated, “What is the Third Estate?” from a pamphlet of the time that argued that the Third Estate was a complete nation and did not need the dead weight of the privileged classes. The government should not allow this idea to take hold. To prevent it more bold steps are required, including the appointment of Elizabeth Warren.

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15 Comments »

  1. Great post!

    That is the greatest hinderance to reform in America today, we can bring Washington and Wall Street both down, but we gotta UNITE first and stop fighting amongst ourselves. Don’t we know by now that we have been taken for a ride by Republicans, Democrates and our employers?

    Comment by Vocalbanker — August 3, 2010 @ 10:01 PM | Reply

    • In a word – “no”. We don’t know that – the politicians, the talking heads and our employers have successfully turned us against one another, deflecting any and all blame from themselves.

      Today’s NYTimes had an article about wage cuts and furloughs. As a state employee, I have already had a pay cut AND a furlough. A year before I began to work for the state, the Raleigh News & Observer did an in depth investigation of state employee wages, etc. I can’t speak for other states, but according to their study, on average, people who went to work for the state of NC took a 15% pay cut vs what they could expect to earn in the private sector. BUT, there was a pension and health care, which was rapidly disappearing in the private sector. Even at that, most younger people coming into the system left before the five year minimum to become vested in the pension. If someone stayed 15-20 years, they usually stayed to retirement.
      The comments on the Times article re: public employees were largely “cut ‘em even more – lazy, overpaid SOBs”. There was very much a lack of commonality among the comments, even those not pertaining to public employees. Many of the commentators took the Republican line that Americans are just too damn greedy and taxes should be cut and unions eliminated, and THAT would show ‘em! Not one word in the entire article mentioned upper management pay, let alone CEOs’ pay and perks. There was mention of record corporate profits, but there was no attempt to tie this to the pay cuts directly – no, “gee, the head guys still get millions and worker bees get pay cuts and 401k cuts, benefit cuts, etc.”
      As I said, the bulk of the 260-some comments were mostly anti-worker. Made me wonder where the commentators earn their daily bread?

      Comment by Sandi — August 4, 2010 @ 5:02 PM | Reply

      • Sandi, those comments are exactly what I’m talking about!!

        Whether it’s on huffpost or yahoo or anywhere else. Somehow the debates always end up getting focused on republicans vs. Dems or private sector employee wages vs public sector. It’s so stupid, when will we get that the real fight needs to be the “Third Estate” vs the “First and Second Estate” and unless these commentors belong to either of those two higher estates, they better UNITE.

        Comment by Vocalbanker — August 4, 2010 @ 8:32 PM

      • Don’t assume those are real people.

        Comment by dnarby — August 4, 2010 @ 10:17 PM

  2. A friend introduced me today to the concept of “‘Gattopardo’ politics” (http://en.wikipedia.org/wiki/The_Leopard), in which switching around the spots on the beast doesn’t change the beast at all. This seems particularly apposite to the theme of your post!

    Comment by Lawrence — August 4, 2010 @ 10:08 AM | Reply

    • Great point. Actually De Tocqueville, in observing the fruits of the revolution 20 years after, makes that exact point. The characters changed but certain aspects of the beast did not.

      My point is to describe present conditions, not to suggest a solution, except to say that a solution must be extraordinary because the beast has taken on an extraordinary configuration.

      My hope is that our awareness and evolving ethos will suggest more benevolent solutions.

      Thank you.

      Comment by thefourteenthbanker — August 4, 2010 @ 10:29 AM | Reply

      • There is a good movie of The Leopard (http://www.criterion.com/films/790-the-leopard), which seemed a little tedious at first. But I watched it about a year before collapse and many of its images and ideas keep coming to mind while trying to understand the crisis, particularly the extravagant party scene towards the end.

        Comment by MB — August 4, 2010 @ 11:00 AM

  3. While I agree with your essay, I do not agree with your conclusion. More and/or new regulators are not the answer. What has happened is the result in the slow, gradual breakdown in enforcement of existing laws.

    This is due to a constantly expanding legal code and attendant bureaucracy. As the legal code expands, the importance of individual laws are diluted in a sea of legislation, which is often contradictory, discriminatory, outmoded or flat out inane; reducing the effectiveness of law enforcement. This is compounded by a constantly expanding bureaucracy which does it’s best to justify it’s own existence, and uses political “pull” to help protect favored industry.

    Until the situation worsens enough to wake up enough people, laws will continue to be broken with impunity, and the looters will continue to make off with the gold. As usual, it has to get worse before it gets better.

    Dave Narby
    http://www.Dave4Assembly.com

    “The Banks must be restrained, and the financial system reformed, with balance restored to the economy, before there can be any sustained recovery ” -“Arthur Cutten”

    Comment by dnarby — August 4, 2010 @ 10:24 AM | Reply

    • I agree that it is not the quantity of laws but the quality. My hope for Warren is they she will attack from that perspective but also force transparency which would allow individual choice and free market mechanisms to create a dynamic for more conscious behavior.

      Comment by thefourteenthbanker — August 4, 2010 @ 10:35 AM | Reply

  4. I would add elite academics to the priestly class of the First Estate because they experience better than average wealth, health, and retirement benefits, which insulate them from capricious uncertainties typically faced by the Third Estate, plus they more powerfully influence policy than ordinary workers, including academics with less elite credentials.

    I’ve been reading an older but very informative book (http://books.google.com/books?id=r0QLU3AWmIIC&lpg=PP1&dq=america%20what%20went%20wrong&pg=PP1#v=onepage&q&f=false) where they review the circumstances that led to the creation of the FDA in the early 1900’s, which was that safety and reliability of medicines, potions, ointments, etc could not be trusted, even to the point of causing death because they were poisons not remedies. I then realized that we’re almost at exactly the same situation today except that it’s financial products that are endangering the public. And that’s where we are with the need for the Consumer Financial Protection Agency, with the need for an effective, trustworthy leader like EW. (That may not be news to some people but it was interesting to me to see it like that.)

    Comment by MB — August 4, 2010 @ 11:19 AM | Reply

  5. Some questions. The pamphlet ” What Is the Third Estate” was written by a priest Abbe Sieyes. It was at least as influential as the propaganda of Samuel Adams in the decade preceding the First Continental Congress.

    Would a book or pamphlet today inflame revolutionary ardor in the US along radical lines as opposed to say a nationalist uprising of the right? Are we more susceptible to a Mussolini or an American Hitler?

    The vast peasantry of the Ancien Regime was hardly involved in the antecedent period of the end of the Ancien Regime. The long haul propagandaist to the educated and petit bourgeoisie of the time was Voltaire. What I am pointing out is that the leadership of the Revolution was radical and hardly right wing. Bonaparte , I should think, was the ” Right Wing” response to the revolution. My HS history book prefaced this period with fifties era right wing propaganda …. “Napoleon sets France right side up”.

    What are the political belief facts about the US in the vast Petit Bourgeosie center? The right of center middle class that increasingly , of necessity for self preservation, seems to favor right wing ” liberty” stances.

    The Abbe Sieyes ,Samuel Adams , Thomas Paine or even Voltaire would not have much effect on US political upheaval. Sad to say, the inflamatory material that would be effective might well be some right winger’s personal battle book. Noam Chomsky hardly cut’s it as a Voltaire type preparer for future radical political change massively supported by the US Petit Bourgeosie or even the confused ” masses”. Chomsky claims to be an Anarcho-Syndicalist. The hyphenation alone dooms him as a propagandist that might be the intellectual source of radical political change. How about Newt Gingrich? Our revered patron saint of political order still seems to be Ronald Reagan.

    Comment by Jerry J — August 4, 2010 @ 3:32 PM | Reply

  6. apres moi le deluge — Louis XV

    Comment by tippygolden — August 5, 2010 @ 7:02 PM | Reply

  7. I am surprised that there were no comments on the obsolete character of the American Third Estate. This relates to the link by 14th to a Salon column by Michael Lind titled ” Are the American People Obsolete” by Michael Lind.

    Lind sees that Americans will allow outsourcing of employment to their absolute detriment and that Americans no longer have the ability to sustain marketing of goods and services in the US. He is correct but omits a massive parameter. What are the per capita parameters of all US sourced claims on persons , corporations, states and state units? Similarly, what are the same parameters applied to other states that would replace future marketing of goods and services sought by the US population?

    No matter what, first estate wealth survival requires the generation of personal income to amortize the claims on these US persons and groups over and above some personal income level to enable the desire to amortize the claims over a number of generations.

    The elites destroy themselves. In doing so, they collapse the existing system. If the third estate is obsolete, then the third estate could politically cause all debts to be forgiven as well. Our kind of Terror could be via currency. Easily done constitutionally. Probably as easy as the Weimar Enabling Act of 1933. Congress may grant sums to the citizen. Congress say, authorizes United States Notes again. Grant each citizen United States Notes as universal legal tender. Pick up the money at the post office. How about a grant to natural citizens of $2 million each. The posting of the money at a central point forces issuance of say a mortgage release. The elites and their institutions then have all cash in the form of US Notes they can spend. Almost all are free and clear and own their assets outright. Obsolete is obsolete. Ha Ha, I could not resist this one. Sounds ludicrous? Why, if the natural person American national is obsolete from a discussion point? For years now, the right wing has been saying the US government cannot pay back it’s debt when , in point of practical fact,government debt functions as a currency form at the top. All that prevents full circulation is the fact that Treasuries are registered. Registry is only around 35 years old. Before that most Treasuries were bearer as were corporate debentures. Amend the IRC and remove the registry requirement.

    Seriously, the always ignored aspect in these types of commentary is that elite wealth almost totally depends on claims from other Americans. Indeed, the shoe is on our foot because we owe trillions to the other nations who would wind up with legal tender too!

    The elites are simply destroying themselves in the US: In a fashion that is remarkably close to broad spectrum Marxist expectations.

    Comrades come rally…………..?

    Comment by Jerry J — August 7, 2010 @ 2:23 PM | Reply

  8. [...] is bust. Both liberal and conservative principles have been completely obliterated by the current First and Second Estates, who have no loyalty except to their own interests.  This is the stuff of revolution. Paul Craig [...]

    Pingback by More Talk of Revolution « The Fourteenth Banker Blog — August 16, 2010 @ 8:44 PM | Reply

  9. [...] current state of the society reflects the nature of society. I have posted before on the stratification of society into various interest groups which I have compared to the conditions before the revolution in France. We have profound ethical [...]

    Pingback by New Banks Needed #1 « The Fourteenth Banker Blog — August 25, 2010 @ 1:46 PM | Reply


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