The dearth of the middle class

Saipan really doesn't have a middle class. Have you noticed?

It's less true on Tinian and Rota, but still true.

The incredible success of the United States has been credited to abundant resources, to the political system, to the economic system, to the mix of people, or to all of those. Whatever the reason, it has led to a huge middle class compared to the rest of the world.

That's something I look for whenever I'm studying a country. It's a pretty good indicator of a lot of things including whether an oligarchy runs the place and the degree of social and economic mobility. I think of it as a sort of flywheel keeping a society running straight.

It seems to me that countries without a strong middle class are more unstable, more unfair and generally less developed. In Lebanon and Iraq you read that things are so bad the middle class is packing up and leaving. Uh, oh.

It's easy to get bogged down in definitions. They vary from country to country. You could say it's only shopkeepers, professionals, clerics and white collar workers. I say I know it when I see it. To me, carpenters, plumbers and other skilled workers are now part of the middle class. That's in the mainland; it would be a joke to say that here, and that's why I'm thinking about the subject.

Walk down a street and enter the next ten shops you pass. Please note, who is the owner? That's who runs the economy. I'm not attacking the Koreans, the Filipinos, the Chinese, ah whatever, it's a long list. They were allowed to start businesses and they did it. If they were hyphenated Americans, e.g. Korean-American, I would say no problem. But where are the local companies?

I'll bet that you were listing off local businesses while you read that, and some of them are very successful. There are also a lot of middle class workers in the private sector. I'll also bet that the lists aren't that long.

Look at the problems Fiji has had in recent years, and look at the cause. From my reading, Fijians felt that they had lost control of their economy, and many couldn't deal with the idea that the Indians would also control the government.

But some local businesses have prices set too high, or are run poorly. That's simple, they'll fail, as most new businesses do. The owners will learn some lessons, pick themselves up, and many will try again. Read some books by successful entrepreneurs and you'll usually see stories of early failures.

You may have noticed I haven't mentioned government workers. There's a reason: they don't have any economic mobility. Nobody's going to quit Finance tomorrow and find an equivalent mid-level private sector job. Sure, they're middle class by income, but realistically they're working class like every contract worker.