The UK Independence Party (UKIP) received a quarter of the vote in the recent council elections. UKIP has been described as the UK equivalent of the Tea Party movement in the US. Its policies are certainly very much to the right. Large tax cuts (possibly one flat rate) financed by huge reductions in public spending, except for defense spending which would increase, a five year freeze in immigration, a return to coal based power stations and no more wind farms, more prison places, and so on. Unlike the Tea Party, UKIP currently fights against the Conservative Party rather than working within it, but too much should not be made of this difference. UKIP’s leader says that he could cooperate with the Conservatives if they ditched Cameron as their leader, and there is some sympathy for UKIP’s aims within the Conservative Party.
One common reading of UKIP’s rise is that it represents the disaffected right wing of conservatism, generated by Cameron’s attempt to move the Conservative Party to the centre ground. However there is one problem with this interpretation - the Conservative Party has not moved to the centre ground. Apart from the odd token issue like gay marriage, the supposed move to the centre was just spin. Under the cloak of the need to reduce debt, the government has embarked on a programme to shrink the size of the state that goes well beyond anything attempted by Margaret Thatcher. Reforms to the National Health Service and education involve the large scale private provision of services or governance.
In terms of the distribution of income, the Conservative Party seem happy with increasing inequality and poverty. The 50% tax band on top incomes was reduced to 45%, while welfare spending is cut. The impact on child poverty will emulate what Margaret Thatcher achieved, according to the latest analysis from the Institute of Fiscal Studies (IFS) released today. Updating figures that I reported recently to take account of the latest welfare cuts, the IFS estimate that the percentage of children in poverty (in families with incomes 60% below the median) will rise from 17.5% in 2010 to 23.5% by 2020. Crucially, according to the IFS the rise in this measure of relative child poverty is entirely the result of the tax and benefit reforms introduced by this government. This is, quite literally, a government created increase in child poverty.
So if we have a government where major economic and social policies are very much to the right of the political spectrum, how do we account for the rise of UKIP? One possible story is that the Conservatives are a victim of their own spin. In trying to ditch the image of the ‘nasty’ party that came to be associated with the Thatcher era, they have alienated those that rather liked her openly right wing style. The parallels with the US may be quite close. Where the Tea Party is associated with, and definitely encouraged by, Fox News and talk radio, so the values of UKIP are also the values of the UK tabloid press, by which we essentially mean Murdoch’s Sun and the Daily Mail.
Yet there is one key feature of UKIP which has no US parallel, and that is in its name - independence from the European Union (EU). Since Thatcher’s time the Conservative Party has been seriously split in its attitude to the EU. The leadership knows that a decision to exit the EU will almost certainly have serious negative consequences for the economy, which is why most business leaders would be horrified by the prospect of leaving. However the tabloid press have run a relentless campaign to highlight any negative aspects of EU membership. It has to be said that Eurozone governance in particular gives them plenty to work with, but when that is not enough, then in true tabloid style stories are made up. While the Conservative leadership seems in its element in going along with the tabloid attack on the welfare state, when it comes to the EU, the game becomes appeasement.
How all this turns out may depend on how the economy performs over the next two years, and how effective the Labour Party are at shifting the public debate. If the recovery is strong, and we see more of this kind of political naivety from Labour (yes, Ed did not read my post on the B word), then the tabloids will push Cameron as far as they can on Europe, but then rally round to support the Conservatives at the election. On the other hand if the recovery is weak, and if Labour is more effective (like here) and looks like winning, then the tabloids may continue to encourage UKIP, in the hope of engineering a reconciliation of the right under a new Conservative opposition leader hostile to the EU.
But these are dangerous games. Much of UKIP’s popularity comes from straightforward dissatisfaction with falling living standards and a lack of good jobs. It is expressed as hostility to immigration and welfare recipients, in part because the tabloid press suggest this is the cause of these problems, rather than it being the result of government economic policy [1]. Even if the recovery is strong and Labour opposition weak, this may not produce enough to enable the tabloids to put this genie back in its bottle. They may find it as difficult to control those who recently voted UKIP as the Republican Party has found it impossible to control the Tea Party.
[1] Some good posts on these tabloid myths: NEF here, the Guardian here, Ian Mulheirn here, and much more detail from Alex Marsh here.
My fear is that by posting such an overtly political comment you risk undermining the objective authority of the economics that you usual post.
ReplyDeleteI appreciate your concern, and I have a few thoughts. It would worry me if I was departing from the ‘objective authority of the economics’. However the argument that this government has what would normally be regarded as a right wing economic agenda looks like a pretty objective claim to me. For example, the IFS evidence on poverty has not been seriously challenged by the government. Nor have they suggested that increasing poverty is an unfortunate and unavoidable by-product of otherwise necessary measures. Hence I do not think it unreasonable to claim that they appear happy with the outcome. (Of course no government minister will say they are happy with rising poverty, but it is always better to judge a politician’s motivations by what they do rather than by what they say. )
DeleteThe combination of a right wing economics agenda and the rise of what is a right wing protest party therefore presents an interesting puzzle, which is what this post is about. It is true that this is a political science puzzle rather than a pure economics puzzle, which means that I’m straying from my area of expertise, but I have tried to keep the discussion scientific. It puts forward an explanation that depends on the influence of the tabloid press, and this hypothesis may be completely wrong, but I hope we can analyse this as an issue for social science. It seems to me to be a hypothesis worth examining, and one that is not widely discussed, which is why I felt it reasonable to stray outside my area of expertise.
Of course even the most scientific statement can be seen as overtly political – something I discussed in this post: http://mainlymacro.blogspot.co.uk/2012/11/lines-between-macroeconomics-and.html . Equally there is a danger that a social scientist will leave behind their normal standards of analysis when political issues are involved. I have been very critical of others when I think that has happened, so I agree I should be held to the same standards.
Although I quite agree...
ReplyDeleteYou still use the traditional division left right. That is not applicable to parties like the UKip.
ReplyDeleteThere is now clearly a split between social/cultural ans financial economic.
The media as usual still have problems to grasp this properly and by framing things (well by the MSM as they are called) will dump LePen, Wilders, AfD in the far right, preferably extreme (sounds really nicely awful).
Basically these parties are social cultural conservative but often they are friends of yours on things like cuts and stimulus.
Why do these parties rise?
Imho mainly because traditional politics have disconnected from the electorate and parties from their traditional voters. Cameron and Co have moved originally the party to the middle and had to made a 180 to try to prevent huge electoral damage (probably a good example for that).
And people are afraid for the future that seems to move faster and faster. And with the economic mess more uncertain.
They are basically protest parties against traditional politics. Originally they get votes from everywhere, somewhat longer term it is the traditional rightish camp (like the Christian Democrats).
Usually these parties end up in a mess. But a few have their house reasonably in order. Advantage is that you can pull 30% (like Grillo or Fortuijn in Holland or De Wever in Belgium) basically with one good guy (or girl). Topics are usually topics of the day: immigration, EU, Euro. A bit of chance that determines this and quality of the leader.
UKip did not get involved with serious scandals, their leader seems comfortable with the policies, seems a likeable guy, main topic is at the center of attention. Farage does one thing enormously well he brings a not mainstream message and looks totally at ease doing so Cameron and Mr Ed Jr simply always look under stress (which gives the impression they are not on top of things).
Plus the fact that from a marketing perspective the Conservatives were beyond moronic in handling the rise of the party. They did nearly everything wrong until it was close to being on the map and are still doing an awful lot wrong at the moment.
The main problem traditional politics has is that it has become totally uncredible for say in average 30% of the population (but probably more between 20-50%. Which makes an effective total market approach simply impossible. Your traditional voters want you to attack them full force. And by doing so the 30% gets confirmed in its opinion that you are worse than crap and by attacking something else he must be better.
Part2
ReplyDeleteBack to the left-right issue. As said you are missing the plot here. UKip is social cultural conservative, but will longer term likely end up left of the Conservatives in financial economic sense. Look at LePen, Wilders economically they are lefties. Conservative economic lefties (they eg donot have a beard) going for mainly traditional lefty policies. They effectively like much of the welfarestate only not for bloody Johnny bloody Foreigners.
UKip has positioned itself as a sort of Conservative split of. probably will be not that extreme here. But doubtful if economic they end up right of the Conservatives.
Teaparty is much more American and embedded in its traditions. Wants back to the old days, Buffalo Bill stuff which means for the US eg much lower taxes. Doubtful if the UKip will go that way. Their voters like the NHS probably and a lot of other entitlements those have to be financed. Kicking Johnny Foreigners out wont make that much difference (you probably need more already for debtreduction/interest).
Weakness of all these parties they have problems to attract sufficient good people to really govern. And nearly always end up with a lot of moron they have to pick from the streets. But campaigning goes well. With modern media you need an appealing leader and maybe a 5 men campaign team. And a lot of the campaigning is done by say the Guardian (for the UKip, see above) although they are to stupid to see it.
These parties are unlikely to gain a majority. But they influence policies. Conservatives have to do something or they are really split (and become pretty irrelevant in the UK).
In Europe you also see parties on the left (Die Linke and the SP in Holland). They can rise everywhere. Blair could have caused a left populist party to arise. He didnot, partly luck, partly he looked to good to attack, no leadership material.
If the economy keeps tanking and the EU messing everything up (what both is imho likely to happen) all bets are off on no majority. You cannot mess things up and after a decade or so donot come up with a credible and working solution and say that the other guys are morons and irresponsible. That message doesnot sell.
A large part is caused because the traditional political parties simply didnot deliver and not by a mile.
ReplyDeleteWelfarestate looks unaffordable, it was financed before mainly on having relatively few elderly. Immigration is not the miracle cure. The visible parts are often several times more criminal than the locals, overcrowded schools, hospitals and housing and often high unemployment rates.
The Euro mess and the economy now in deleveraging mode which makes it low growth at best.
Aging with its costs hitting in (but no funding insight).
Things that were supposed to work and to work for the future are torn down one by one.
Communication strategies are poor and often 19th century. Strategies are bringing your message across not getting your next FBmessage or Tweet out.
Basically dealing with these parties is a pure marketing issue. At the end of the day it is Customers running away. Trying to get customers that have moved back. It is not much different from selling soap. Only with the organisations that traditional politics would face in the soap market, they would be buried by now.
Traditional politics failed. Simple as that. Rule one is go to Oprah and tell the world you are sorry and love your wife, children and dog.
Come with a credible new set up (not recycle the rubbish that didnot work).
Take your customers serious.
Looking at just these groundrules and the Conservatives.
Somebody else did something wrong when they were not yet in power.
There is no new strategy (just filling the holes of the day when they arise).
Angry former customers are called bigotted, closet racists, not of this world, morons. Well that won't get the angry customers back. Like Unilever stating you know why you now buy P&G stuff these days, it is because you are simply too stupid for words. In soap a ridiculous example, but in politics standard procedure.
Which brings us to the question is Cameron the man to do that transformation to the real world. Most likely not. But it will have to happen anyway or the Conservatives are no longer one of the 2 biggies but the UKs SPD (traditional no2).
Probably best for them if they see how things go with adjusting policies and how voters react to it and replace him relatively short for the election. With Mr Boris being the only credible candidate, the rest looks hardly better in attracting voters as the average polished turd.
However he will face the same problems and looks unorganised (like Cameron) shouldnot have enough time to mess things up himself (which is clearly a risk).
However the other side (Mr Ed) looks simply no way PM material. He simply makes Cameron look good. If he not adjust (doubtful imho the people around him look crap as well) or is replaced (but by who?). It might not be too difficult after all.
Which brings up another issue. Democracy. That is not supposed to mean tell people with modern marketingtechniques what they have to think.
Simply say 30% or so of the UKs population simply has UKips views. That is simply a thing you have to live with. Brushing that under the carpet clearly didnot work. They're back and now they are angry.
In other worlds these people have to be represented in the political arena. The traditional parties took the genie out of the bottle and it is not going back anyway. The UKip might if the Conservatives play their cards right. But overall it is not going to happen. Traditional parties have to find a way to live together with these parties. If not the whole system will become even more dysfunctional as it already is. You simply cannot keep going on with not delivering on what you (explicitly or implicitly) have promised and think you will always be reelected. Means you simply can wait for La Presidente LePen or PM Wilders. And before that countries would have become ungovernable.
Surely part of the problem is that UKIP spouts populist slogans which the other parties won't contest. Apparently simple answers to complex problems will always be popular. Somehow the implications of the policies have to be made clear to the general public; unfortunately as many of your posts bemoan evidence appears to play little part in in dogma driven policy making.
ReplyDelete> there is one key feature of UKIP which has no US parallel, and that is
ReplyDelete>in its name - independence
Well, one of the planks of the Tea Party and its ilk is taking back power from the federal government in Washington.
Perhaps it is not the Tea Party, with its evangelical emphasis, but our own class-centred anti-waste league of the early interwar years, which wanted the abolition of Lloyd-George’s ‘land fit for heroes’, that is a better political model for UKIP, centred as it was in the south-east of England and led by the Daily Mail?
ReplyDeleteThere is certainly a movement going on to paint the current government as a necessity of statecraft, that old Tory Party line taken apart so well by the late E H H Green in his 'ideologies of conservatism'. And that reflects so badly on the Liberals.