Is the American middle class waking up?

Kathy Hochul just won a Congressional district that includes all or parts of seven counties. The district is home to UB, Brockport State, Geneseo, and a few community colleges, but not to any big cities. Orleans, Genesee, Livingston, and Wyoming counties are largely rural, as is the section of Niagara County that’s in the 26th. This district is about as Caucasian as they come. The area has been Republican since Lincoln. It voted for McCain in 2008, for Bush in 2004 and 2000, for Dole in 1996, for Bush in 1992 and 1988, for Reagan in 1984 and 1980, and so on back as deep as the label goes. For a Democrat even to have been competitive means that something important must have changed.

What changed is that middle-income, middle-aged, white Americans have awakened to the reality that the Republican promise of general prosperity through investor privilege has not only not met expectations but has now threatened the economic security of folks who have feared and distrusted government for generations.

Every pundit in the land will have something to say about this race, but let us let the data speak before the metaphor-mongers overwhelm us. The numbers that this Congressional district is becoming economically self-aware. Except for Amherst, Clarence, the Rochester suburb of Greece, and some very private, very big estates in the countryside around Letchworth State Park, our analysis of tax returns shows that this slice of America is aged, aging, and full of not very prosperous people. Of the 650,000 tax returns filed in 2008 in all these counties, more than 70 percent were for incomes of under $50,000.

That figure—$50,000—represents the median household income in New York State, meaning that half the households in the state make more than that and half make less. In this district, seven out of 10 households make less than the median. And only two percent make more than $200,000 a year. In the rural counties, the split between the high-income households and the 70 percent of households that are moderate-income or poor is medieval, because in Orleans, Wyoming, Genesee, and Livingston counties, only one-half of one percent of households have incomes over $200,000.

Rural poverty is real, but so is something subtler and arguably more important: Country people who like to hunt, who like their connection to the land, who often work seasonally in agriculture, forestry, as truckers or as tradesmen, have far lower incomes and far higher expenses than they used to. Looking over 10 years of tax-return data from New York State’s office of Budget and Taxation show that the rural counties in this district are poorer than Rochester’s Monroe County and Buffalo’s Erie County, even with the large concentrations of urban poor in both those cities. The bottom of the middle class has simply fallen out everywhere you look. In Wyoming and Genesee counties, more than 71 percent of households made less than $50,000. In Orleans County, where the Erie Canal once brought prosperity, almost 75 percent of the households that filed tax returns had incomes at or below $49,999. If you overlay increases in the Supplemental Nutritional Aid Program—formerly known as Food Stamps—you see that the biggest increases, in both numbers and percentages, have been in the suburban and rural areas. Economic distress is real, and it is visible.

And yet it is in the rural counties that the Republican still edged the Democrat. Not by much—Corwin beat Hochul 2,423 to 1,734 in Wyoming, 3,868 to 3,411 in Livingston, and 1,626 to 1,393 in Orleans. But the importance of these numbers is this: It was a competition even there. This special election would not have become competitive had not House Republicans voted for the Medicare-into-voucher plan. When the Republican Congressional majority voted in April for a plan to turn Medicare from a universal, government-paid healthcare plan into a voucher system that would cover only the first $6,000 of the cost of health insurance, that changed everything.

Elite pundits may miss this part. Everywhere that wage-work is a part of the life experience, everybody who works for a living knows that they pay a payroll tax for their retirement benefits—and that they will be needing those benefits, unless they’re eligible for veteran or civil service pensions. Both employees and owners of small businesses know what happened to their 401(k) plans in 2008 and 2009, so even Republican-inclined voters who make more than the median income are at least skeptical of Republican party rhetoric about privatizing Social Security. The sense of economic insecurity is widespread, so Social Security and Medicare are more precious to more people than ever before.

In Western New York counties, where more than 15 percent of the residents are over 65, and where within the next five years more than 25 percent of residents will be over 60, every village coffee shop, fast-food joint, and saloon is visibly occupied in most daylight hours by retirees, and this is what they talk about: retirement security. Since the 1935 Social Security law was signed by Franklin Delano Roosevelt, every worker who has paid into the Social Security trust fund has become eligible for a Social Security pension. Since the 1965 Medicare law was signed by Lyndon Baines Johnson, workers have paid into the Medicare trust fund. Everybody of a certain age has known about these issues literally all their working lives. And everywhere in this area, as soon as the Republicans in Congress voted for a plan that would change the rules on Medicare, the chat went something like this: We’ve been paying for this all our lives, and the minute we’re going to be eligible, they’re going to change the rules and take it away.

In the 26th District, especially in the social networks that connect at coffee shops and VFW, American Legion, and volunteer fire halls, it is impossible to find anybody who doesn’t understand their personal financial stake in the Medicare system maintaining its integrity. Many there may shake their heads about how much Washington spends, but that’s all about theory. Retirement money, and retirement healthcare, is everybody’s reality.

But in their profound political miscalculation over Medicare, Republicans just made an even more profound political miscalculation over culture and style. Jane Corwin, whatever her virtues as a volunteer at Children’s Hospital and at the Community Foundation, displayed two characteristics that—given the national Republicans’ assault on most people’s old-age well-being—made social class distinctions politically deadly. First, there was the matter of Corwin’s address. Spaulding Lake was, until the 1970s, a quarry that served the boys of Clarence, Amherst, and even Cheektowaga as a swimming hole. But for the past 20 years, Spaulding Lake has been a luxury enclave, a regional icon of very conspicuous consumption, a place to put what Engels called “primitive accumulation” on display. Second, there was the matter of Corwin’s family fortune. Hochul’s father built a fortune with a computer services firm. Jack Davis built his cache of throw-away money with his heating-elements business. Corwin’s father built his fortune on an alternative phone directory. When the news media reported on financial disclosure documents revealing Corwin as either a deca-millionaire or a centi-millionaire, every piece of jewelry the Republican candidate wore, every snarky staffer’s flub, every recitation of the Republican litany on taxes, deficits, and trade was seen and heard as the scripted utterance of someone quite outside the experience, the expectations, and the anxieties of the rest of us.

The electorate here awoke to the class divide. Worsening income polarization has been a reality in this district for decades, but not a political fact. Defeated expectations about economic growth have been the experience of the Buffalo media market at least since the Nixon presidency. What changed in this election was that the Republican intellectuals last month convinced the Republican politicians to vote, to put themselves on the record, in a way that broke their grip—perhaps forever—on the ever-hopeful, ever-aspiring Republican base of suburban and rural elderly and soon-to-be-elderly voters, because those voters today acknowledged that they are never going to be rich enough to do without government programs.

And along the way, voters here also rejected the got-it-let’s-flaunt-it cultural style that Nancy Reagan legitimized and that Republicans have come to embody.

It wasn’t so long ago that voices from this part of the world were absolutely blue in the face over Michelle Obama’s extravagant trip to a resort in Spain, and over grocery-checkout tabloid photos of her $600 designer sandals. Populism found its first expression in the Tea Party movement, which was easily purchased and directed by cynical billionaires.

But this is something different. A Democrat whose message was quite explicit about saving middle-class entitlement programs, and about refusing to further reduce taxes on investors and speculators, almost won an outright majority. Republicans are going to be very hard put to argue that the nativist Jack Davis’s tallies would have split for their candidate, because their candidate had to wear not only the national Republican message but the special burden of being visibly rich in an increasingly poor and increasingly income-polarized part of America.

Even the well educated and relatively well-off Amherst and Clarence voters, some of whom doubtless cross the $200,000 threshold in household income, supported Hochul over Corwin by more than 5,000 votes. In that part of the district, the class divide is on display with every morning’s edition of the New York Times and of the Wall Street Journal, which daily contain ads for watches that cost more than most people’s cars, for private jets, for tailored clothing, for high-end jewelry, and their weekend editions flaunt real estate listings that truly deserve to be called pornography, because there’s no more swinish display than photos of multimillion-dollar houses in a Congressional district most of whose residents cannot reasonably aspire to ever attaining a positive net worth.

Baby Boomers have been beguiled for years by such media. Looking at the income tax data, one can see that, sandwiched between the masses under $50,000 and the barons who take in over $200,000 per annum, there is a zone of relative comfort comprising a little over a quarter of the households here. But even they have been politically shaped by the Wall Street crisis. And evidently, given the vote totals out of the most prosperous part of the 26th District, they can distinguish between themselves and the new rich, who are so much richer than everybody else that the divide has now become politically actionable.

One hopes that the Democrats understand the nature of this victory. One expects that they will have a hard time of it. And the Hochul victory may have come too soon for the Democrats. Because of the Supreme Court’s decision in Citizens United, corporate expenditures on political campaign ads mean that the rest of 2011 and all of 2012 will see untold amounts of money spent on political messaging designed to make the Caucasians of the 26th District get back in line, where they’ve reliably been. Democrats can be expected to rush forth to buy flannel shirts, bowling balls, Red Man, 30.06 rifles, and other indicia of class authenticity, to pretend that they’re not as closely held as Republicans are by the financial interests that dominate campaign giving. The most positive outcome of the Hochul victory would be political longevity for a concept that has not yet quite sunk in, but that is beginning to—that the economic interests of most Americans cannot ever be addressed by the narrative that has ruled us since Reagan, which is that privileged treatment for investors and speculators equals freedom, prosperity and hope.

During World War II, when a great President called for national unity and shared sacrifice, the great instrument to achieve this goal was an activist, newly competent national government funded by a steeply progressive tax code. Every dollar of personal income above about $25,000 was taxed at over 95 percent. Ask the people of the 26th Congressional district if they want government-funded healthcare. Ask them if they want households with incomes over $200,000 to pay higher taxes. Ask them if they want a deca-millionaire, or a centi-millionaire, to represent them. Their answer may sound like “We don’t like Michelle Obama’s fancy shoes,” but it’s the same answer they just gave in electing Kathy Hochul.

This was a history-changing election. It didn’t have much at all to do with the Democratic candidate. It had everything to do with Americans recognizing that their need for government was more real than their fantasies about becoming rich. The Baby Boomers, in short, just grew up.