Lazy Nationalist Populism: Globalisation and Inequality on the Transatlantic Axis

Danny Quah - 13th January 2017

Danny Quah argues that 'globalisation’s great message' needs to be re-told to Western voters.

When policy-makers fail to speak truth, citizens construct their own narratives that to them make sense. This applies around the world much as it does in the US or the UK. The mantra that has seized liberal thinking is that “Nationalist populism — Trump, Brexit — is backlash against globalization and inequality; we can fix this by reducing the worst of economic disparities.” Despite conventional wisdom, however, this analysis is potentially wrong. Continuing to promote such a palliative could have disastrous consequences.

For the UK these are the facts: The run-up to Brexit saw no sharp increase in inequality; London — which overwhelmingly rejected Brexit — was no pull-away economic success; and the people who most recently suffered greatest — the young — were also the ones who voted Remain.  The London Mayor’s Office recorded race-hate offenses rose 64% in the six weeks after the Brexit referendum compared to the six weeks before. But the Brexit campaign saw not a single demonstration against the “top 1%” or against London’s international banks.

Chris Giles (Dec 2016) puts it thus:

“To start, we should dismiss much lazy talk linking populism and Brexit to a backlash against globalisation and inequality. UK inequality is stable and those who have done worst in the past decade — the young — were much more likely to vote Remain. Brexit has its roots much more in elderly nostalgia than in economic hardship.

“When we talk about the economic pain of the past decade, the second piece of frank talk should be a call to everyone to stop blaming others. There is not a group or a region in the UK that has prospered since 2007. London has seen the lowest hourly wage growth since 2008 of any UK nation or region.”

For the US, Kishore Mahbubani and I described in The Geopolitics of Populism (Dec 2016) how the poster child of the globalisation-inequality narrative — the displaced, older, less-educated, white working-class male — turned out, after all, not to have been critical for Trump’s Presidential win. In the event, those voting more for Trump than for Clinton were rich Americans, white women voters, white college graduates, and young white Americans. In other words, however that poster child might have voted, many Americans completely different from him voted Trump. Indeed, despite how Clinton won the popular vote, Trump won among all white Americans 57% of the vote — a whopping 20 percentage points over Clinton’s 37%:

[Here I have tabulated only those exit poll results most relevant to the theme I am developing. The table shows that white female college graduates were pretty much the only white demographic that Clinton won. Less surprisingly, and therefore ot in the table, Trump also beat Clinton among all male voters (52% to 41%), all older Americans (ages 45-64: 52% to 44%; 65 and older: 52% to 45%), all white male voters (62% to 31%); and all voters who didn’t graduate from college (51% to 44%).]

The journal Nature published (Dec 2016) a survey of empirical evidence more generally, and argued that the surge in nationalism can be explained only in part by domestic economic dislocation. Joan Williams (Nov 2016) described in the Harvard Business Review how the white working class in America felt no particular antipathy towards the rich, but instead only the professional classes — related to but hardly the same as a national aversion to income inequality.

Kishore Mahbubani and I conjectured that there is indeed a sensible narrative on globalisation, inequality, and the rise of Transatlantic nationalist populism. But it does not follow conventional thinking. Instead, for inequality it is its sharp decline, not increase, that has generated feelings of disquiet and discontent in the US and the UK. This inequality is that that has dramatically fallen between the advanced and emerging nations. Throughout the 1990s emerging economies totaled up their GDP at market exchange rates to only 30% of the G7’s, but this past quarter-century saw that disparity fall precipitously. Total GDP, of course, does not tell us how well off the average person is, but it appropriately measures the global footprint of these different collections of nations. By 2016 that 1990s income gap of 70% between emerging economies and G7 had converged to under 14%; parity will obtain by 2020 (working out the implications of IMF projections).

How does this shrinking income gap translate to nationalist populism? For decades, scholars and policy makers have debated the reality of a Global Power Shift — away from traditional powers in the West — towards some loose, evolving group of emerging nations. Such a shift has appeared in what became described as The Globalization Lift in The Geopolitics of Populism. It is represented in the dislocation, since the 1980s, of the world’s economic centre of gravity from out of the middle of the Atlantic Ocean, to head towards East Asia. This great shift east will now only accelerate with the Transatlantic Axis’s loss of political certainty and geopolitical confidence, and the associated rise of nationalist populism.

The veracity on this, however, will remain unresolved for decades, not least as relevant configurations of power include both measurable dimensions — military and economic — and intangible qualities — soft power, credibility, legitimacy — that can be difficult to assess. But whatever the reality on such a Global Power Shift, for now it is certainly the case that no American political leader wins votes by warning the electorate how America hereafter needs to share power. Strobe Talbot described in The Great Experiment how Bill Clinton’s political instincts told him to keep to himself that he reckoned America needed to prepare for a multipolar global order, one where America would no longer be “the military political economic superpower in the world” (as Bill Clinton put it at Yale in 2003, reported in Kishore Mahbubani’s The Great Convergence). Ordinary Americans care — at a deep, instinctual level — that they, or at least their elected leaders, get to be in charge, and get to write the rules of the game.

Globalisation’s great message to the majority of Western voters need not, ultimately, be that their top 1% has gotten far, far richer than them. It is that others around the world are rapidly catching up to them, and that what is now on the cards, if all goes well, is a genuinely global future — one where no nation is exceptional or indispensable.

Policy-makers in the advanced nations need to speak truth to their populations. Can America accept that it will need to share power? Or will the promise to make America great again prove appealing even though empty? How will Asia’s thought leaders manage both the world’s looking to them for new visions, at the same time that Asia itself faces its own nationalist challenges?

 

Danny Quah is a GP Board Member. This post first appeared on his own blog.

Photo credit: Dominic Lüdin via Foter.com / CC BY-NC-SA