Winston Churchill once said: “democracy is the worst form of Government except for all those other forms that have been tried from time to time.” He was right. Over the past few years we have witnessed across the world a disturbing trend. Moderate liberal democracies are being rattled and shaken by the election of xenophobic, racist, nationalistic, and often misogynistic presidents as if they were being given away like candy.
Moderates, political scientists and, especially, liberals are flabbergasted at the sight of presidents like Trump, Bolsonaro and Viktor Orban occupying the centre of world politics.
“What happened?” has been the main question asked over the past few years. The answer came out along the lines of: masses of ordinary voters had been tricked, conned, even enchanted by delusional demagogues that sprung up in times of crisis. Something had to be wrong, they said -- marches filled the streets with hundreds of thousands chanting “not my president,” and a general sense of living in a nightmare became a reality for many. I'll admit I was one of them.
Yet I believe that democracy was not hacked. No, people aren't crazy, and no, these people are no “basket of deplorables.” This, my friends, is democracy at work, and the explanation for this terrible group of leaders (I don't wish to be apologetic about them) lies in the failures of the new globalized, technologically connected, world that we have created for ourselves in the past decades. As the political scientist Ian Bremmer cleverly summed up: “Elites won’t be able to manage populism until they stop seeing it as a threat and start seeing it as a symptom.”
The Three Deadly Sins
In 1989, Francis Fukuyama published his famous article and later book “End of History and the Last Man,” in which he argued that as communism was falling to pieces in Eastern Europe, the last real alternative to liberal capitalist democracy was dying off. The highest degree of human evolution and development had been reached. The road ahead would be filled with prosperity, world peace and stability made possible by free market economy and democracy, with the United States at the helm of this transformation. I disagree. I think this argument was very wrong.
Center-right and center-left political parties have since taken turns to govern, but in essence their programs did little to move away from the status quo. Politicians are now seeing populists as a menance and an abomination, yet as Ian Bremmer says, this problems had years in the making and now the chickens are coming home to roost.
I believe that three things went wrong with this easy going, predictable world: globalization, free immigration and inequality.
Policies such the creation of the European Union, liberalization of the economy, dismantlement of the welfare state, deregulation the economy, and austerity after the financial crisis became uncontested beliefs for the establishment. This was the birth of an “elite political consensus” established in much of the Western world.
These policies have led to an extraordinary concentration of wealth in the top 1% of the population. This percentile now controls 45% of the global GDP. This, I consider, is irrefutable evidence that the free reign of the market only produces more inequality when the state does not intervene to redistribute wealth.
On the other hand, the median income of households has only increased 16% since 1980, while the richest 1% has seen their income go up 190% during that period. This level of wealth concentration was made possible by huge tax cuts and vast deregulation of the economy, which supposedly would “trickle down” to the majority of the population.
But there hasn't been much trickling going on. These policies attacked the fundamental principle of capitalism: social mobility. The gap between the haves and have-nots has only grown larger and the middle class has shrunk and is suffering the effects of the current wave of economic concentration.
At the same time, the Washington Consensus and the US-British special relationship pushed forward an increasingly globalized world. In this scenario, large free trade agreements were signed and manufacturing jobs began to move away from the West to cheap factories in countries like China, where workers could be easily exploited. This was Fukuyama’s expansion of capitalism: more productivity, at whatever the costs.
The foundation of post-war prosperity relied on well-paying jobs for semi-skilled labourers. The promise was that if you worked eight hours a day, played by the rules, in return you would get a very good living out of it, two cars, a house and vacations. This is all a distant memory for most.
Manufacturing jobs are disappearing across the board and people are suffering. The number of people working in this sector in the US has fallen from 20% in the year 1980 to just 8.5% today. The culprits vary from NAFTA to China and robots, but people don't see the difference: the bottom line is that their new job is for minimum wage at Walmart.
Currently, 48% of Americans consider themselves to be “working class,” while in the year 2000 that number was 33%. And if this has happened in the richest country, something is very wrong.
In addition to these policies, free immigration (the movement of people across the world as economic factors of production, lightly unregulated to accomodate the needs of a globalized economy), has been part of the political consensus adopted in the West. Yet there is a real sense of dissatisfaction amongst many voters that argue these policies are hampering their job prospects with extra competition and depressing their salaries with low skilled laborers coming into the market.
Populist parties from Fidesz in Hungary to the National Rally in France, and most recently VOX in Spain have picked up on these fears and made them one of their signature talking points. They have used the idea of a common foreign enemy to consolidate their bases by playing on the fears of many, that the melting pot was becoming too melty.
The myth that their salaries were being undercut by foreigners became mainstream. In times of a general decrease in wages and job insecurity, the ground is fertile for that rhetoric, even though there is no evidence to suggest immigrants have negative effects in the economy. In fact, they improve it, by 0.6% of the GDP a year in the UK, for example.
I believe that the path to social mobility has been broken for quite some time, with ordinary people working just as hard as their parents did in countries like France and the UK but getting huge debts, less consumer power and more stress out of it. The world promised after the fall of communism apparently forgot that it had to work for the many, not the few.
The grand scheme of the market as the ideal allocation of wealth is not working, and has never worked. The liberal order promised by Fukuyama is being challenged by its own failures to deliver. Ordinary voters are suffering the effects of that post-Cold-World-world not thriving as we once thought possible.
We are seeing a very close correlation between the pullback of the state from welfare programs and government intervention in the economy, resulting in more suffering, inequality and anger. Let’s face it: the current system was not designed for the average citizen, people are being taken for a ride, and many are fed up, and rightly so.
What to do with the “deplorables”
The “elite political consensus” policies adopted by the West since the late 80's drove up inequality, made well-paying jobs disappear and liberalized immigration. This created a deep anger that is now manifesting itself very virulently. The idea that these leaders and movements are simply an error of history that will disappear is a denial mechanism for the elites. Their Fukuyama world failed miserably.
Government “as usual” has disenfranchised voters and drove them to political apathy and disillusionment with liberal democracies. Now that apathy has turned to anger.
This, I believe, was capitalized by politicians who decided to shock the world with their policies and statements that, in many cases, touched the hearts of conventional political wisdom and political correctness.
A sense of shaking things up attracted millions of disenfranchised voters that saw in these leaders a real political representation to many of their grievances. Trump, Bolsonaro, Marie Le Pen, Wilders, were saying all the things people secretly thought but couldn't dare to say out loud: “Mexicans are stealing our jobs,” “the European Union is not working for us,” “God and traditional family roles belong in the center of politics,” and so on.
We need to realize that this is a wake up call. Political pundits have been completely caught off guard by these movements and are labelling them as anti-political or anti-system. They are no such thing. We have created such grief and insecurity that people have begun to answer back - in a chaotic way, I will admit - but their support for outspoken politically incorrect leaders is in itself a political position, not the desire to burn down democracy.
Global leaders need to channel that political involvement into productive solutions that seek to reform our economic and political systems to accommodate the interests of the majority, not the few. We should not see this as a malignant pest that we have to eradicate, but as an opportunity of change and social inclusion. For now, the deep dissatisfaction was capitalized into a large wave of political incorrectness that is shaking the basis of our liberal democratic order.
Only one thing is certain: there will be no “back to business as usual,” to simpler times of uncontested neoliberal globalization. History has not ended, yet.
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