In 2012, something unusual happened. The wealthiest 4 percent of voting-age Americans, by a narrow plurality, supported a Democrat for president.
This hadn't happened since 1964. Before that, it hadn't happened since possibly the 1880s (scientific survey data for back then is, sadly, nonexistent).
So was 2012 a blip, like 1964? Or was 2012 the start of a phase shift, in which the Democrats replace the Republicans as the preferred party of the wealthiest Americans?
I'm pretty convinced that it does mark a phase shift. My strong hunch is that for the foreseeable future, the wealthiest Americans will prefer Democrats. But before getting to the future, let's start with the past.
The chart below is built from American National Election Studies data. I use the top 4 percent because that the granularity that the data allows. A family income of $220,000 puts you in the top 4 percent in 2012.
This much we know: Very rich Americans have voted decidedly Republican for decades. But there were three exceptions: the elections of 1964, 1992, and 2012.
The 1964 election is pretty easy to explain. Republicans nominated the far-right conservative Barry Goldwater. Most establishment Republicans considered him crazy. Lyndon Johnson, by contrast, was a moderate. It's clear that this was a blip because by the 1980s, Republicans were back to winning 70 percent of the wealthiest Americans. Meanwhile, Democrats were winning about 15 percent. Others reported not voting or voted for third parties.
The 1992 election marked an inflection point of sorts. For one, the Democrats changed their policies, with Bill Clinton as the standard bearer for a new pro-business, neoliberal centrism that sought to win over the growing professional classes. For another, H. Ross Perot ran as an unusually successful third-party candidate in 1992 on a platform of balancing the budget, which has always been a popular position among the very wealthy, pulling some votes away from the Republican Party. It's also possible George H.W. Bush's broken "no new taxes" pledge alienated some of the very wealthy.
Republicans recovered somewhat among the very rich in 1996 and again in 2000. But they have declined since. The 2012 election then marked a somewhat dramatic change, as the share of top 4 percenters voting for a Democrat rose from 24 percent in 2008 to 44 percent in 2012. This dramatic shift might reflect some noisiness in the data.
But the size of this shift provides an important clue in understanding the larger trends. Given what we know about the stickiness of partisan identity (it is very, very sticky), it thus seems very unlikely that a bunch of Republicans suddenly became Democrats. Rather, the more likely explanation is that the individuals comprising the top 4 percent changed.
The changing composition of American elites is probably the most convincing explanation for why Democrats are doing better at the top of the income ladder. Put simply: The people at the top in 2012 are somewhat different from the people at the top in 1988, and very different from the people at the top in 1952.
The richest Americans look different now than they did before
There are a few things we know have become very strong predictors of voting Democratic. One is that nonwhite people tend to support Democrats at higher rates than white people do. Another is that the highly educated have become much more liberal over time, making educational attainment a better predictor of voting for a Democrat.
And over time, the top 4 percent has become much more diverse and much more highly educated.
Let's look at the diversity first, because the story here is pretty straightforward. In 1952, the top 4 percent of wealthiest Americans were entirely white. By 2012, 75 percent of the top 4 percent self-identified as white. So the wealthiest Americans have become more diverse over time.
The top 4 percent have also become much more highly educated over time, as have Americans overall. Again, given that there is a strong relationship between educational attainment and liberal values, especially in recent years, it might not be surprising that wealthy elites have become more Democratic-leaning as they've become more highly educated.
One intriguing clue to the relationship between education and partisanship is that the trend data on educational attainment has a notable dip in the share of top 4 percenters with college education in 2008. The bump back up from 2008 to 2012 corresponds with the major bump up in the Democratic presidential vote share among top 4 percenters from 2008 to 2012 described above (from 24 percent to 44 percent).
This is very consistent with the claim that the partisan patterns reflect changes in which individuals comprise the top 4 percent, not changes in the values of individual people. After all, individual people don't go from having college degrees to not having college degrees to again having college degrees in four-year intervals.
These ups and downs in educational attainment among the top 4 percent income earners probably have something to do with who got rich in the mid-2000s and then who lost their money in the Great Recession. The big boom industries of the mid-2000s, especially construction and housing and real estate, were not industries that necessarily required college degrees. But as these industries collapsed, so too went the fortunes of those who had done well in them.
The American economy is changing
But we shouldn't get too distracted by these short-term reversals. More interesting and important are the longer-term trends, which are pretty clear: Over the past several decades, top-end wealth in America has increasingly concentrated in a handful of metropolises, leaving the in-between parts behind. Most of these very prosperous cities (especially New York, San Francisco, Boston, and Los Angeles) have become very solidly Democratic. The stagnating rural areas, by contrast, tend to be much more Republican-leaning.
One way to see this is to look at congressional districts. The places with the largest concentrations of wealth are now disproportionately represented by Democrats. In 2014, 17 of the 25 wealthiest congressional districts (measured by average income) were represented by Democrats. And overall, the median household income in Democratic-represented congressional districts was about $2,000 more than the median household income in Republican-represented districts ($53,358 to $51,834).
We can also observe some of these larger changes by looking at the partisan giving by the Forbes 400 wealthiest individuals, which political scientists Adam Bonica and Howard Rosenthal have tracked over three decades. Between 1982 and 2012, the share of GOP money from the Forbes 400 fell from 68 percent to 59 percent.
As Bonica and Rosenthal write, "Changes in partisanship could well reflect changes from a manufacturing and extraction economy to a technology and information economy — Silicon Valley and Hollywood are generous to Democrats." Even before Trump locked up the GOP nomination, these trends were continuing in the 2016 election.
Tech journalist Greg Ferenstein offers a pretty convincing explanation as to why the new information and technology industry leaders prefer Democrats:
I think the more likely explanation is that the nation's new industrial titans are pro-government. Google, Facebook, and most Internet titans are fueled by government projects: the Internet began in a defense department lab, public universities educate a skilled workforce and environmental policies benefit high tech green industries. The CEO of Uber, Travis Kalanick, is a fan of Obamacare, which helps his entrepreneurial drivers keep their health insurance as they transition between jobs. In other words, the Democratic party is good for emerging industries and billionaires recognize it.
2016 and beyond
In May, the Committee for a Responsible Federal Budget surveyed the presidential contenders and declared Hillary Clinton the most fiscally conservative. Clinton is largely pro-trade, pro-immigration, and pro-infrastructure, all priorities for big business. She's also pro-environment, pro-LGBTQ rights, and pro-diversity, and thus in tune with the social concerns of well-off cosmopolitans.
Donald Trump is pretty much the opposite. He has essentially pitched himself as the candidate of middle-class and "Real America" whites, who feel slammed by trade and immigration and oppressed by smug liberal environmentalism and political correctness. His takeover of the Republican Party has been remarkably efficient.
Trump's tax plan does have lower taxes for the rich, and this may keep him in good standing with some of the top income earners. But rhetorically, he is channeling a lot of anger against the very wealthy. So who knows what the heck he'd actually do if he became president. And even if he keeps taxes low on the rich, his economic policies may do more damage to their wealth overall, which is largely invested in assets whose value is sensitive to the state of the economy, both domestic and global.
Moreover, it's not like Clinton is proposing to bring back the 70 percent top marginal tax rate of the 1970s, or anything close. So, it's no surprise that top CEOs are supporting Clinton over Trump 58 to 42 percent.
Yes, Trump is bullish on the extractive energy and fossil fuel sectors, which may keep the relevant corporate titans in the GOP coalition, and his high-tariff promises could help a few manufacturing companies. But even though he promises to dismantle the Dodd-Frank Wall Street Reform and Consumer Protection Act, only 1 percent of Wall Street campaign donations through March went to Trump, whereas 53 percent went to Clinton.
Presumably this is because Wall Street has learned to live with Dodd-Frank. What folks on Wall Street don't want is a major trade war. They also have a ton to gain from the Trans-Pacific Partnership.
These contrasts have become unusually clear in the light of Clinton versus Trump. But they are really the reflection of processes that have been building for a while.
As I've argued above, the big, slow-moving transformation over the past few decades is that the composition of very wealthy America has changed. It has become more diverse, more highly educated, and more concentrated in industries and places that tend to support Democrats. So it's not surprising that Democrats are doing better and better among the most well-off.
And as this has happened, Democratic politicians have done a better job of responding to the values of these wealthy elites, becoming more liberal on social issues and more neoliberal on economic issues.
By contrast, Republicans have more and more been caught between the shrinking number of very wealthy and politically engaged elites who as of 2012 still disproportionately supported Republicans, and the actual Republican voters, who share neither these elites' austere vision of a minuscule welfare state nor their internationalist support for lots of trade and immigration and free markets everywhere.
Now that Trump has driven the proverbial truck through this gap, some of these Republican wealthy elites may actually find they have more in common with Clinton Democrats than Trump Republicans. But again, look beyond the 2016 election, and you'll see the GOP/big business tensions have been building now for several years.
Or, put another way, 2012 was not a blip. It was the beginning of a phase shift. Democrats are replacing Republicans as the preferred party of the new American rich.
It's unclear at this point, however, whether this is a good thing for Democrats' electoral fortunes. The big risk for Democrats is that they will worry too much about catering to their wealthiest supporters and alienate their lower-income supports into becoming populist Republicans. Some of this may depend on how the economy develops, and whether inequality continues to grow. And some of this will depend on public policy choices. The parties' electoral fortunes will also depend on how and when the Republican Party transforms and reconciles its own internal conflicts, especially its racist elements.
But whatever happens, one thing seems clear: The old alignments in American politics really are shifting.