I see literature on a sliding scale with other kinds of fiction, genre and general, and I think it's important to draw a distinction between different kinds of books that isn't based on good vs. bad but, rather, on a fundamental difference in nature. To me, that difference is story vs. ideas. The more literary a book is, the more important the ideas behind it are. If you read a 10/10 book of pure literature, and someone asked you what it was about, you wouldn't even mention the story in your reply. The story would be irrelevant to you, and recounting it wouldn't give your listener the slightest idea why the book was worth reading.
Just think about it. Nobody reads Ulysses because they can't wait to find out what happens when Leopold Bloom visits the library. Nobody reads Remembrance of Things Past because the S&M is so wild (it is, though), or opens up Lolita because they love this Humbert Humbert character, and can't wait to spend a little more time with him.
And when you pare those books down to the stories they tell...well, they often boil down to a pretty short thread. "Captain Ahab of the Pequod is determined to hunt down the whale that took his leg. Ahab finds his whale, but Moby Dick sinks his ship and kills him. Only Ishmael survives to tell the tale." That's pretty much the story and...how long is Moby Dick?
It takes a lot longer to describe the plot of a Harry Potter book, or The Hunger Games. I think Harry Potter and The Hunger Games fall somewhere in the middle of the scale - amazing stories enhanced with interesting ideas. If you try to describe the ideas in Harry Potter or The Hunger Games and leave out the plot, you'll strip away a lot of what makes the books unique, compelling, charming. You take away the magic.
When you read a good story, the plotting is much denser, and if you can tell what's going to happen next the author hasn't done his or her job right. A good story outsmarts you.
Think about that. People talk about literature as though it's all this fancy pants smart stuff, but I think literature fails when the author tries to outsmart the reader. Literature is very much about making abstract ideas material and concrete, and I think good literature makes it feel easy to follow along.
It's the thrillers and the mysteries and the romances where the author really needs to stay one step ahead. Where the author needs to make sure that someone who's read a hundred other mysteries, or a hundred other romances (or several hundred, or a thousand) can't figure out whodunnit, or how the hero and heroine will get their happily ever after. Where the author tries to trick you.
We've all read a book where we get to some dramatic twist or turn that leaves our hearts in our throat, jaw hanging open, thinking, "Oh, no way, you did not just do that!" Sometimes I'll be too wrapped up in the story - too swept away - to stop and do a doubletake, but sometimes I'll picture the author as a little bobblehead floating in a cartoon bubble over the page, snickering at me. And next to the little bobblehead, in all caps: GOTCHA!
What does all this mean? It means that there's no reason to dig a moat around Literature and post guards at the drawbridge, letting only a select few authors cross. It means that when someone tries to sneer at you for reading genre novels, you can know - and tell that person - why their bad attitude makes no sense. It means there's no intelligence cap - or floor - anywhere on the scale. Just different goals, and different markers of success.