Winner of the New Statesman SPERI Prize in Political Economy 2016

Friday, 16 December 2016

Why populism should be no surprise

As well as watching and listening to my SPERI/New Statesman prize lecture, you can now read it in the form of a SPERI paper (slightly more coherent and comprehensive that the lecture I gave). I have also written an article that is now up at the New Statesman, which attacks the same issue a slightly different way. This post is aimed at encouraging you to read that article.

It suggests that we should not find either the Brexit vote or Trump’s election a surprise. Once we recognise that a large proportion of (most?) voters are not that interested and therefore not that informed about politics, and then ask what information these voters actually received from the media, then both Brexit and Trump were quite rational choices.

If that statement sounds shocking, I think it is because those of us who are interested in politics and are well informed find it difficult to imagine what it would be like not being so. We ask how can Trump be more trusted than Clinton, because we have read and indeed listened to all his lies, but if the only source of information you look at is the nightly news you will have mainly heard about Clinton’s emails. We ask how can half of those who voted in the EU referendum opt for evident self-harm, because we have read that economists think it will be self harm by a margin of 22 to 1. But if all you have seen is he said/she said reporting in the media, it just looks like economists are divided on the issue.

I’m not arguing that the impact of globalisation is not important. It helps people lose trust in mainstream politicians. Instead I’m asking why legitimate grievances should lead people to start believing in snake-oil salesmen. People will go for populist policies, if the knowledge that these policies will not work is denied them, or portrayed as just one more opinion rather than knowledge.

The power of the media to distort truth should never be underestimated. In 2015 voters elected a Conservative government because they thought they were more competent at running the economy. They blamed Labour for causing austerity. Pretty well all the evidence suggested the opposite was true. But all most people heard was the Conservative narrative about ‘clearing up the mess’. You should blame Labour for letting that happen, but if you do you also have to concede that the information people receive is critical in the decisions they make. The power of a simple but false narrative is immense: remember most workers had experienced an unprecedented fall their real earnings over this period, yet they still chose to blame Labour for this rather than the global financial crisis and austerity.

After everything that has happened over the last two years, these points should by now be self-evident, and to some they are. But a great deal of analysis just ignores the role of the media. I surveyed a great deal of work on the Brexit vote, trying to relate it to all kinds of variables, but I saw no analysis that looked at the media people were exposed to. In the UK there is not much we can do about the partisan press in the short term, but we can do something about the broadcast media. How many more Brexits and Trumps do we need before we do?



23 comments:

  1. Given your comparison of economics with the climate change debate, it's interesting to see this poll tracking belief in climate change against Leave/Remain:

    https://www.theguardian.com/environment/2016/jun/16/brexit-voters-almost-twice-as-likely-to-disbelieve-in-manmade-climate-change

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  2. There are several problems with SW-L’s patronising claim that populist politicians are snake oil salesmen, and members of his own profession know best.

    First, numerous economists are demonstrable idiots who have done a huge amount of economic damage: e.g. Rogoff and Reinhart and other deficit/debt phobes.

    Second, a number of highly intelligent well educated people who agree with populists, e.g. John Redwood and Niall Ferguson.

    Third, the point that Brexit will reduce UK GDP is irrelevant in that many of those who voted for Brexit did so because they thought a few percent less GDP was a price worth paying for avoiding political union with what they see as nutters like Merkel who want to Islamise and Africanise Europe.

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    1. Ralph I hope you personally don't think Merkel wants to Islamise or Africanise Europe. At the very least though she was crazy to encourage the Syrian refugee flood (who have every legal right to be in Europe, lest we forget) to come to Germany specifically! Even when you have 80 million people, absorbing another 1 million who don't speak your language and usually have poor education arriving at once in the space of a year is insane. Especially if you want British referendum voters to think the EU is a sensible organisation.

      (The refugees of course should have been thinly spread by mutually agreed shares among the member states, and the Americans should have been made to take a big chunk since they are so responsible for Syria. The EU is unable to arrange such things, as even the politically correct Clintonian Paul Krugman has noted after the vote.)

      On your third point, Ashcroft's polls showed it was only Remainers who thought we would lose a few points off GDP i.e. serious economic results at all. Brexiters mostly thought it would make little difference, so no wonder they assumed a Leave vote was therefore safe. The other questions showed they gave reasons such as sovereignty, a different leg of the trilemma to free trade.

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  3. "you will have mainly heard about Clinton’s emails". False. After giving Trump unlimited airtime during the primary season, the media belatedly realised that Trump could win the general election. The entire national and local media were biased in favour of Clinton. No economists recommended Trump. National newspapers which never endorsed a candidate before endorsed her to stop Trump. Only a couple of regional newspapers in the whole country endorsed Trump. Few newspaper columnists in the whole country supported Trump, whereas many coordinated secretly with the Clinton campaign. The State Dept Inspector General's report into the email SERVER (not "Clinton's emails") was written off as a "nothingburger" and critics were written off as Trump supporters. What Clinton did with classified information is a crime and she was guilty, and was saved by a nervous head of the FBI. And remember the AG's tarmac meeting with Bill? It was a criminal investigation into a felony, and not a "security inquiry" as she put it.

    If you run a candidate under current criminal investigation by the FBI, it will be on the news.

    On top of this, Clinton spent $500 000 per day on TV advertising and Trump spent almost none. She botched it, because 75% of her ads were about his character, which the public already knew from the news. That was historically unprecedented. Clinton is congenitally scared of publicly promoting liberal economic policies, which is what it took to win the election. Historically, over a quarter of presidential TV ads have been about the economy, and hers were a fraction of that. So even making concessions to Sanders (free university for 85% of households and doubling federal funding for health clinics) was invisible. Not the media's fault, when Clinton avoided the issues and concentrated on Trump's character to try and broaden her appeal. The media did the same i.e. they did what she wanted them to do by focusing on Trump as an authoritarian and liar. They were both wrong, but you can't blame the media since Clinton wouldn't have had it any different.

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  4. I presume "the partisan press in the short term" means that media ownership controls can't be introduced until Labour gets back into power. Same problem as in 2015 then. Labour can't get back into power unless they agree to stop mass immigration. Say what you like about that change being economically unnecessarily, indeed harmful. In a country where no one believes this, and you face hostile media, the policy itself is unnecessary and harmful and simply has to be dropped. Labour's loss is thus not simply the fault of the media but of Miliband, the liberal commentariat which equates immigration control to 90s Tory Eurosceptic xenophobia, and of the EU for not ceding control on it. Repatriation of control of migration in the EU is inevitable. Yes it requires treaty changes. But there are honest-to-goodness Nazis in Greece and pro-balanced budget liberals and leftists are losing everywhere else. Time for a policy change, and less media-blaming saying we can't win.

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  5. «The power of the media to distort truth should never be underestimated. In 2015 voters elected a Conservative government because they thought they were more competent at running the economy. They blamed Labour for causing austerity.»

    This is the usual narrative of the overwhelming centrality of fiscal deficits on voting, and of voters fooled by press misrepresentations about fiscal policy, because voters don't trust variously "aligned" experts.

    But suppose that what really matters to swing voters in southern marginal seats is southern house prices, not fiscal deficits. Then they voted very rationally: during a New Labour government southern house prices fell dramatically, and during a Conservative government they have been booming again. Not only that, but many voters are very dependent on credit for lifestyle consumption, and during a Labour government there was a relative credit squeeze, while during a Conservative government there has been a debt boom.

    George Osborne, the architect of the Conservative political strategy since 2010, has spoken very clearly about it:

    «A credible fiscal plan allows you to have a looser monetary policy than would otherwise be the case. My approach is to be fiscally conservative but monetarily active»
    «“Hopefully we will get a little housing boom and everyone will be happy as property values go up,” George Osborne is said to have quipped at a Cabinet meeting earlier this year.»

    There can be little argument that George Osborne's government has competently pursued the plan that he he designed; except that he was not quite as «fiscally conservative» as he had hinted, as he allowed the fiscal and trade deficits to be quite high; but he surely delivered on «monetarily active» and «housing boom».

    That's something that a plurality of voters can well have rationally chosen at general parliamentary election time, and since those elections are first-past-the-post and by constituency, a plurality wins, even if most voters and non-voters may be against George Osborne's plans. The difference with the "Leave" vote is that it happened on a proportional, national, basis.

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    1. "everyone will be happy as property values go up". A very Tory definition of "everybody"!

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    2. Just to be totally obvious, I'll paraphrase:

      "The power of the media to [discuss red herrings like "austerity"] should never be underestimated. In 2015 voters elected a Conservative government because they thought they were more competent at [pushing up asset prices]. They blamed Labour for [letting asset prices fall]."

      Written like that it seems rather accurate to me.

      That is for many voters  «competent at running the economy» is an euphemism for "pushing up asset prices" and «causing austerity» is an euphemism for "letting asset prices fall".

      A cursory glance at the Daily Mail shows how important asset prices are to "aspirational" (another euphemism) voters, and that there are many.

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  6. As to "populism" property prices have been booming again in Eire, and the government has been trying to make them bigger, faster, and this article there correctly calls that "populism":

    http://www.irishtimes.com/opinion/government-thinking-on-housing-remains-confused-and-populist-1.2848698

    The policy described is called "Help to buy", a close clone, not just in the name, of George Osborne's popular policy for driving up property prices in southern England. That policy and similar "populism" has won George Osborne's government an unexpected absolute majority in 2015. Many voters very rationally were grateful for the tax-free effort-free capital gains that his government had competently delivered to them.

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  7. In the article you write:

    "Economists need to organise in the same way as scientists did."

    As far as the UK goes "Climate Change" became a political/legal fact with the 2008 Act. The organising group were led by Friends of the Earth.

    Media change did not so much lead as follow.


    At the time of the 2009 COP in Copenhagen media coverage became focussed on the "Climategate" dump of emails which reinforced and publicised the Climate sceptic viewpoint.

    It was as I recall in 2010 that I first heard discussion (Richard Black BBC at the Frontline Club) of the move away from false balance/imbalance in BBC editorial guidance, and importantly a change in the opinion of editors that it was a science story to be handled scientifically as well as a political story to be handled with due scepticism and all necessary she said/he said.

    Unless the media can be persuaded that academic economic thought is substantially scientific and a similar, "this is the landscape (science) this is the action (politics)" divide can be established, I doubt that we will see much progress.

    I personally believe that the driving force has to be in part political agitation, e.g. Friends of the Earth, by those experienced in taking flak during combat, backed up by academic thought.

    By rights such agitation ought to be bread and butter to segments of the Labour movement/party and the Liberals and the nationalist parties in the devolved nations.

    Where is their agenda?
    Where is their voice?

    I must believe that they are out there, but sadly just out of earshot.

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  8. I am hearing a lot from journalists about how 'social media' has changed their profession for the worse, and how it has led to many people in effect making up their own news.

    I think this is wrong.

    It feels as though it is the majority over-50s in the UK who have backed Leave and the Tories, who have backed Trump in the US, and who have been responsible for Germany's lack of economic sharing through a raised inflation target to help out its Euro neighbours.

    The problem seems at the moment wholly with those gaining their news from the old sources.


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    1. Good point. There also seems to be a problem with journalists taking "social media" to mean Twitter (check out how much media coverage it gets even pre-Trump), and not Facebook. Twitter has hardly any substantive discussion but Facebook does, but is less public due to friend settings. Twitter is easy and cheap to write about, but it isn't the same as talking to the public face to face. No wonder the national, coastally-based media in the States didn't spot the popularity of Trump in the 'heartland' since they don't go there. Social media wasn't a corrective.

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  9. Brexit wasn't populism, that is what the global elite wanted though it is running into problems being actually put into practice(and of right now, there is no Brexit). Why do you think false flag 'attacks' like Paris and Bastille happened, much like 911?

    You don't get it, because the global elite doesn't always support the status quo(which was what Brexit was really against). This is the mistake many of you kind make.

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    1. Wise up. (Though on a more serious note, SWL might like to consider that the powerlessness ordinary people feel helps feed conspiracy nuts like the previous Anonymous here, and the unaccountability of the EU is part of that even if they never killed anybody!)

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  10. I'm still puzzled by the certainty with which we are told that Brexit will make everyone worse off. As far as I can make out, the logic used to support that argument would also predict that large countries would be more affluent than small countries. But when I look around I really don't see such a correlation between population size and affluence. We get small affluent countries such as New Zealand, Singapore, Switzerland and Iceland; and large affluent countries such as USA, Japan etc. Likewise poor counties seem to cover the full spectrum of population size. By contrast, some variables really do seem to tightly link to well-being and affluence. If a government only borrows in its own currency, then that country is likely to be up at the top of the affluence scale. Countries with a strong sense of cohesion where people consider ALL of their fellow citizens as valuable also seem up at the top of the affluence league. The EU project seemed to me to be about unraveling exactly those attributes that in the real world link to affluence. We were moving towards being governed by a diffuse administrative continuum where the nation state was dissolved and instead we had local indentities and a Europe-wide administration with a population that just looked out for their local patch. To me that looks exactly how not to set up a system of governance.
    I don't have a grounding in social science, I guess I must be missing something. How do economists explain the fact that population size doesn't correlate with a country's affluence?

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    1. Population size correlates with GDP, but there's no theoretical reason I know of to think it correlates to GDP per capita. The latter is, however, linked to good governance, education, etc

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    2. Anonymous@19Dec, SWL's post is all about how EU integration is certain to be great for increasing GDP per capita. Isn't EU integration simply transitioning from a situation with several small countries to a situation where they have amalgamated into one large country? Presumably if SWL is so certain that EU integration will increase GDP per capital, then there must be irrefutable empirical and theoretical evidence to back up his certainty.

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    3. Brexit will make everyone worse off because it will make our international trade more difficult and costly. This will reduce our exports, reducing GDP, and make imports like food more expensive, which adds inflationary pressure to the effects of sterling's depreciation.

      I doubt Brexit, if it happens, will have a great effect on immigration over the long term. We need skilled and unskilled young workers to come in, and we will always welcome asylum seekers. International students coming to study at our universities are one of our more successful service exports.

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  11. Actually there has been a fair amount of comment around media bias on the Radio 4 media show. Or, more precisely, the idea that in attempting to be unbiased and show both sides of the story the media had failed to highlight that one side was a load of bollocks. Although the brexiteers kind of acknowledged it themselves with their "why listen to the experts" rhetoric- there seems to be a glib cynicism in the air. Much better to listen to the voice of the pub bore than the informed analyst.

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    1. For some reason in the Brexit campaign the BBC were very disproportionate in their coverage. Firstly it seemed Farage ( 1 MP) and Boris Johnson et al ( a faction of the Cons) received the same exposure as Labour, Liberal Democrats, SNP, Greens, PC and the Remain Conservatives. You could say The Greens a Remain party of 1 MP should be equal to UKIP but of course it was not.


      More seriously and unprecented in BBC history the Brexit side were able to contradict every non political source of news. So our allies, Bank of England, leading industrialists, Economists, International banks, universities, CBI, Scientists, technologists, medics, IFS, LSE , OECD, IMF, NFU were turned by the BBC into
      'political actors' and so the likes of Gove and IDS or UKIP leader were able to frame all the news coverage. Experts became 'the elitist ' view as the BBC legitimated and 'equalised' the Brexit views of Farage et al on all items on the news even compared to the IMF

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  12. I've just watched a fascinating interview on The Young Turks, the US alt media. In it they showed a young man,a Virginian, non college educated, who was savvy and articulate but who voted for Trump.

    He said he and all his friends knew Trump was a snake oil salesman from way back. So why did they vote for him? Desperation and hope.

    He said don't talk about us as redneck climate change deniers; we're the ones who suffer cancers as a result of environmental degradation due to climate change.

    He said that you can't blame immigration for taking jobs because they just want to better themselves just like him.

    Bring the coal industry back? He knows it's not coming back but folk are desperate for hope.

    John Harris in the Guardian did a very good video in Stoke on Trent just before the Brexit vote and the vast majority were for Leave, probably for many of the same reasons that the young American voted for Trump.

    My point? The media and facts may be less important than you think.

    Also to describe a forecast as "knowledge" is stretching it a bit; knowledge implies certainty and a forecast is anything but.

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    1. "Also to describe a forecast as "knowledge" is stretching it a bit; knowledge implies certainty and a forecast is anything but."

      So you shouldn't quit smoking because doctors can't say exactly when you will get cancer?

      S

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  13. From my own direct experience I have to agree with what you say. You need to spend a wildly unrealistic amount of time reading around to understand many of these issues for yourself - but then that's why we have parliamentary democracy.

    Unfortunately the back story to last 30 or 40 years is about our collective desire to have the benefits of equality, good health care and social democracy while also having ever lower taxes.

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