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Tuesday, October 1, 2019

Barry Eichengreen : The Populist Temptation: Economic Grievance and Political Reaction in the Modern Era http://books.g... [feedly]

Excerpts from Eichengreen's book, and Interesting take on "populism" and "bellicose nationalism", and political economy conclusions one may draw on its bourgeois remedies in the face of "revolutionary Marxism" as opposed to where the latter had no established base. 

The excerpt below is from Brad DeLong's Blog.

Barry Eichengreen : The Populist Temptation: Economic Grievance and Political Reaction in the Modern Era http://books.g...
https://www.bradford-delong.com/2019/09/barry-eichengreen-_the-populist-temptation-economic-grievance-and-political-reaction-in-the-modern-era_-in-the-unite.htmlBarry Eichengreen: The Populist Temptation: Economic Grievance and Political Reaction in the Modern Era http://books.google.com/?isbn=0190866284: "In the United States, the United Kingdom, and Europe... the reaction of voters against the political establishment, nationalist and racialist sentiment directed against foreigners and minorities, and a yearning for forceful, charismatic leadership, this something, whatever we call it, is not new...

...The characteristic economic policies of populist leaders are damaging and destructive, and the impact of populists on political institutions is corrosive. The attitudes they animate bring out the worst in their followers. Populism arrays the people against the intelligentsia, natives against foreigners, and dominant ethnic, religious, and racial groups against minorities. It is divisive by nature. It can be dangerously conducive to bellicose nationalism...

Populism is activated by the combination of economic insecurity, threats to national identity, and an unresponsive political system, but... can be quelled by economic and political reforms that address the concerns of the disaffected... reinvigorate economic growth... hope that their lives will be as good as those of their parents... that their lifetime of labor is respected and rewarded. Populist revolts rarely arise in good economic times...

Equally important is that the fruits of that growth be widely shared and that individuals displaced by technological progress and international competition are assured that they have social support and assistance on which to fall back.... This is not a novel formula. But if its elements are commonplace, they are no less important for that..

Modern societies show disturbingly little capacity to respond... struggle to develop a political consensus around the desirability of implementing and, no less important, adequately financing programs that compensate the displaced and help them adjust to new circumstances...

The United States glorifies income disparities. With a culture that celebrates the entrepreneur and decries government intervention, it does little to restrain market forces. But at the same time as it encourages creative destruction, it provides little assistance to the casualties of what is destroyed. It insists that workers displaced by globalization and technical change should fend for themselves and leave government out of it. When times are tough, this mix of policies and attitudes is all but guaranteed to produce high anxiety about income security, discomfort about prevailing levels of inequality, and anger at the political class. In part these attitudes are a product of the distinctive American ideology of individualism and market fundamentalism...

Resistance to federal government intervention also reflected the country's historic division between black and white and between North and South. From Reconstruction through the civil rights movement, southern businessmen and farmers opposed federal government involvement in the economy for fear that it would compromise control of their black labor force. In the 1930s they opposed New Deal programs out of concern that these would interfere with their established way of doing business and the prevailing social order. White southerners were not opposed to the decentralization of social programs or to receiving federal matching funds so long as the design or at least the administration of those programs devolved to the states. Such devolution was consequently a legacy of the New Deal, one that endures even today, for example in the power of states to decide whether to expand Medicaid to cover low-income households under the Affordable Care Act, or Obamacare...

The contradictory nature of populism in the United States is no anomaly. People displaced by globalization and technical change are distressed about not sharing in the benefits of an expanding economy and by their government's failure to do more about it, leaving them susceptible to the siren song of populism. But their views are also informed by an ideology that tells them government is the problem, not the solution. One can't help but think of the constituent who allegedly warned Representative Robert Inglis of South Carolina, at a town hall meeting, to "keep your government hands off my Medicare," not realizing that Medicare was a government program. Herein lies the appeal of Donald Trump, who gives voice to the anger of the masses over their economic condition and the failure of government to address their problems, all in the manner of a populist, but who also opposes more spending on social insurance, more trade adjustment assistance, and higher taxes on the rich, all in the manner of a committed Randian. This is not a combination that bodes a happy ending...

This idea that the fundamental goal of policy is to regulate the economy in order to correct its visible defects and alter the distribution of income in ways that make for solidarity and social justice is not something that is spoken out loud by the leaders of either U.S. political party, much less by their more Randian followers. It developed in Europe as an alternative to more radical working-class movements hostile to the market economy and to representative democracy, notably revolutionary Marxism—movements that never gained the same foothold in the United States. It was an effort to get European societies to pull together in order to avoid splintering apart...


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