The idea is that classism is often tolerated where racism (and sexism and bigotry against gays and so on) is not, because prevailing neoliberalism makes it seem okay to ascribe "rational" incentives to other people and discriminate accordingly. After all cynicism about other people's motives is a positive common-sense virtue in a society ruled in all aspects by a free market. An ability to think in terms of costs and benefits and find the applicable way of applying such an analysis to any scenario is the mark of a mind thinking at its clearest. At the same time, when we discriminate along those lines and not along the old racist, sexist, etc. lines, we can congratulate ourselves for how far we have come, regard our existing social order as progressive, and assure ourselves that our own advantages are merited, and not the product necessarily of racism. Eschewing bigotry and promoting diversity strengthens our ideological faith in the meritocracy that hardly exists in reality, as Walter Benn Michaels argues in this LRB book review of a collection called Who Cares about the White Working Class?.
My point is not that anti-racism and anti-sexism are not good things. It is rather that they currently have nothing to do with left-wing politics, and that, insofar as they function as a substitute for it, can be a bad thing. American universities are exemplary here: they are less racist and sexist than they were 40 years ago and at the same time more elitist. The one serves as an alibi for the other: when you ask them for more equality, what they give you is more diversity. The neoliberal heart leaps up at the sound of glass ceilings shattering and at the sight of doctors, lawyers and professors of colour taking their place in the upper middle class. Whence the many corporations which pursue diversity almost as enthusiastically as they pursue profits, and proclaim over and over again not only that the two are compatible but that they have a causal connection – that diversity is good for business. But a diversified elite is not made any the less elite by its diversity.This is an argument spelled out in his book The Trouble With Diversity. In the LRB piece, he pushes the book's argument further, detecting a similar mechanism in the worries about classism manifest in Who Cares About the White Working Class?:
It’s thus a relevant fact about Who Cares about the White Working Class? that Ferdinand Mount, who once advised Thatcher, is twice cited and praised here for condemning the middle class’s bad behaviour in displaying its open contempt for ‘working-class cultures’. He represents an improvement over those who seek to blame the poor for their poverty and who regard the culture of poverty rather than the structure of capitalism as the problem. That is the view of what we might call right-wing neoliberalism and, from the standpoint of what we might call left-wing neoliberalism, it’s nothing but the expression of class prejudice. What left neoliberals want is to offer some ‘positive affirmation for the working classes’. They want us to go beyond race to class, but to do so by treating class as if it were race and to start treating the white working class with the same respect we would, say, the Somalis – giving ‘positive value and meaning to both “workingclassness” and ethnic diversity’. Where right neoliberals want us to condemn the culture of the poor, left neoliberals want us to appreciate it.Michaels wants the left to worry more about income inequality and fight for the eradication of the income differences that make for social classes. (I wonder what Will Wilkinson would make of that.)
The great virtue of this debate is that on both sides inequality gets turned into a stigma. That is, once you start redefining the problem of class difference as the problem of class prejudice – once you complete the transformation of race, gender and class into racism, sexism and classism – you no longer have to worry about the redistribution of wealth. You can just fight over whether poor people should be treated with contempt or respect. And while, in human terms, respect seems the right way to go, politically it’s just as empty as contempt.
Built into the idea of meritocracy -- an ideal often conflated with the American Dream -- is the corollary that the poor deserve contempt. It's easy to see how people could overrate their own hard work and its relevance to their own success (such as it is) and believe that hating poor people is a way of providing crucial tough love. We can jumble up the causal links and think that hating hte poor will help make the meritocratic dream more real. It serves as a way of voicing our belief in the meritocratic ideal.