Is Brexit a culture war or a class war?

The dynamic of today’s service based economy means that social liberalism is in part generated by class.

Imagine someone with a piece of thin card. They draw a circle with a compass and cut out the circle. Two people arrive and pick up the card. One says look, someone has cut out a circle. The other says there is no circle, its just a thin bit of card. The debate over Brexit within the Labour party is in danger of following a similar structure.

For most Labour voters and members its position should be absolutely clear. Labour should stand for openness and international cooperation. Brexit is the opposite of these things. However a minority says that many in Labour’s working class heartlands support Brexit and we should not abandon them. The first side sees a circle but is in danger of ignoring that it is made out of card, and the second side sees only a piece of card.

We need to think about politics in two dimensions rather than just one. The first dimension is the traditional left/right division that used to be the mainstay of politics. The second is the dimension of culture or identity. At one end of the cultural dimension you have social conservatives, who value local communities and the nation and are suspicious of outsiders, where being an outsider can involve sexual norms, race or religion. At the other end are social liberals, who value diversity and tolerance, and who dislike borders of most kinds.

People see in three dimensions, so the card circle is both a circle and a piece of card. Equally people care about issues in both the left/right dimension and the cultural dimension. For most people Brexit is an issue on the cultural dimension. The call for Labour to represent Remain is straight forward. Labour has for decades been on the liberal side of the cultural axis, and so they should support Remain. It is the main reason why the majority of Labour voters and members support Remain.

The response of a minority in the Labour movement is to talk about Labour’s traditions as a working class party. Examples are John Cruddas or Lisa Nandy. It is a powerful argument for Labour party members, who both respect the traditions that Labour represent and do want the party to represent the working class. It is particularly powerful because there is some guilt that the Labour party, like other parties of the left, has moved from a party of the working class to being a party of what Piketty calls the Brahmin left, and Paul Mason calls the new core of the Labour project. But this argument could be accused of seeing the card circle as a piece of card.

Of course Labour should represent the working class along the familiar left/right dimension, in terms of labour market policy, industrial policy, reducing inequality and so forth. Cultural politics in no way replaces class politics. But just because working class communities tend to be more socially conservative than professional classes does not mean we should abandon Labour’s liberal stance on issues like immigration and, of course, Brexit. Labour should represent the working classes in the economic dimension but not the social dimension.

To reinforce this point Danny Dorling points out that Leave was as much a middle class as a working class vote. Furthermore, as I noted here, once you take London out of the equation the North is now only slightly more pro-Brexit than the South, and there is as much a divide between the West and the East. Why should Labour be the party that supports middle class social conservatives?

Adding the dynamic of today’s big cities

This conceptualisation of Brexit as essentially a culture war and not a class war is powerful and contains a lot of truth. But it leaves some puzzles unresolved. The first is geographical. If Brexit is a guide to people’s position on the cultural axis, why is London along with other dynamic cities full of social liberals and the towns, depressed cities and countryside much more socially conservative? The second is about class. Again if Brexit is a measure of social conservatism, why is the working class more socially conservative than the professional class? If where we are on the culture axis reflects innate preferences, why don’t we find as many social liberals as conservatives in different regions and classes?

One possible answer may relate to the geographical and social dynamics of an advanced, service based economy, where towns and cities based around manufacturing plants are an exception rather than the rule. Suppose in countries of this kind, where the state does little to intervene (it is neoliberal), it is the cities that provide the dynamic that propels the economy forward, while cities based on old industries and rural areas are more stagnant. This does seem to be true for the UK and other advanced countries. In addition, people flow constantly between the dynamic and stagnant areas, in part because cities tend to be younger.

If this is the case, then this dynamic could play a geographic sorting role. Those who are more open, who like change and diversity will move to the city. Those who prefer continuity and community will stay, or may even move from the city to the town after a time. So over time you will find the more socially liberal tend to be in cities, and the more socially conservative tend to be in more rural areas.

In addition, those from middle class backgrounds will find it easier to gain the skills that the city needs, while those from working class backgrounds will find it harder through no fault of their own. The less the state intervenes to assist social mobility, the more this will be true. If you are middle class the more likely you are to be in environments (universities and then cities) that are diverse and therefore encourage social liberalism, while if you are working class you are more likely to get stuck in towns or stagnant post-industrial cities. This helps explain something else about Brexit: lack of education is one of the strongest predictors of support for Brexit.

I would like to add one additional dynamic here. The more educated you are, the more likely you are to be familiar with multiple sources of information, and the more open you will be to different perspectives. You are more likely to value expertise because your position in the labour market depends on your own expertise. As a result, you will be less likely to be influenced by what you read in one newspaper, and more likely to seek out what experts are saying on issues like Brexit. In my view newspaper coverage, both of immigration and then of Brexit itself, were important factors behind Brexit, and may be part of the reason that Scotland voted for Remain.

This suggests two social processes. First, this economic dynamic based on growth in cities sorts those at different points of the cultural axis by geography. Second, and I think more importantly, where you are in this cultural axis may not just be the result of your genes, but may also be a result of this sorting process itself. Liberal attitudes may be encouraged by a university education and working in dynamic, diverse cities.

In a dynamic environment where there are plenty of opportunities, diversity seems like a natural consequence of that dynamism. Indeed it may even be seen to contribute to the dynamism, which in fact it does. And of course a university education often gives you a skill set that defines your class position. In contrast, if you live in areas that are economically stagnant you are more likely to see things in terms of a zero-sum, us and them mindset. If immigrants arrive, or you fear they might arrive, you naturally think that they must take away something you already have. These are all tendencies of course. There are plenty in the cities who see little benefit from their dynamism, and plenty in the countryside who are much wealthier. There are Leave voters in dynamic cities and Remain voters in the countryside.

Power and Populism

There is one additional point about this segregation between dynamic cities and more stagnant towns. Political power generally resides in dynamic cities, and this leads to a perception at least that the political elite acts only in the interest of the cities. As a new and fascinating paper by Will Wilkinson argues for the US, this economic divide that both sorts for and encourages certain social attitudes among those in cities can cause resentment and alienation in the rest of the country to a degree that can create the conditions for populism to flourish.

Trump’s support, like support for Brexit, comes from rural America or areas of industrial decline, while most in dynamic cities view this type of populism with incredulity. Population sorting, where power and growing wealth lie in cities where the governing elite rule, leads to self-reinforcing resentment against the elite from those who live elsewhere. That resentment can manifest as simply protest, as happened with the gilet jaunes in France, or it can be captured by politicians or policies that pretend to attack the elite.

Where does that leave our original two dimensional conception where most of the Brexit action takes place on the socially conservative to liberal axis? We can now add two key caveats. First, while a position on this axis is often portrayed as reflecting innate characteristics, it may also be in part a consequence of economic forces and class. Second, support for Brexit may in part reflect some basic economic forces to do with the geography of economic dynamism in predominantly service economies.

Does this mean those arguing that Labour should support Brexit because the working classes are more likely to support it are right? Of course not. Brexit, like Trump, will do nothing to help the working class, and Labour should never become a socially conservative party. Indeed Brexit will do precious little to help any of those that voted for it: it is an utterly stupid policy. But equally seeing this as a culture war that the progressive side have to win is much too simplistic. The roots of our current populism are based on an economic dynamic where growth occurs in large cities, and an economic system that does not spread enough dynamism, knowledge, wealth or power to the rest of the country.

Links between austerity and immigration, and the power of information

This discussion by Roger Scully about why people in the Welsh Valleys voted Leave is depressing although not surprising. In essence it is immigration, bolstered by local stories of Polish people coming into communities and reducing wages. I doubt if quoting econometric studies about how little immigration influences wages would make much difference to these attitudes (although that is no excuse for people in authority who should know better ignoring these studies). I think it is attitudes like this, in places unused to immigration partly because work is not plentiful, that makes some politicians say that arguing in favour of immigration is ‘politically impossible’.

This is the first link between immigration and austerity I want to draw. The Labour party before 2015 had also decided that attacking austerity was politically impossible: ‘the argument had been lost’. Focus groups told them that people had become convinced that the government should tighten its belt because governments were just like households. The mistake here, as I wrote many times, was to assume attitudes were fixed rather than contextual. I was right: austerity is no longer a vote winner. [1]

Why might attitudes to immigration change? I strongly suspect that anti-immigration attitudes, along with suspicion about benefit claimants, become stronger in bad times. When real wages are rising it is difficult to fire people up with arguments that they would have risen even faster in the absence of immigration. But when real wages are falling, as they have been in the UK in an unprecedented way over the last decade, it is much easier to blame outsiders. Equally when public services deteriorate it is easy to blame newcomers.

It is wrong to think that this only happens among working class, left behind communities. Catalonia is a relatively rich part of Spain, and there has always been resentment about this area ‘subsidising’ the rest of the country. But it is very noticeable how support for pro-independence parties increased sharply as Spain turned to austerity, although that could also be a reaction to corruption scandals.

Here is the second link between immigration attitudes and austerity. Austerity has contributed to the slow growth in real wages and is the main cause of deteriorating public services, but often outsiders are easier to blame.

This is particularly true when it is in the interests of the governing political party and its supporters in the press to deflect criticism of austerity by pretending immigration is the real cause of people's woes. This is the third link between austerity and immigration, and it is one deliberately created and encouraged by right wing political parties. In this way Brexit has its own self-reinforcing dynamic. People vote for it because of immigration, its prospect leads to falling real wages as sterling falls and the economy falters, which adds to bad times and anti-immigrant attitudes.

If all this seems very pessimistic, it shouldn’t be. While the right will almost certainly continue to play the anti-immigration card in the short term, because they have few other cards to play, they can be opposed by a left that makes the case for immigration. As just as views on austerity have clearly changed, so can views on immigration. particularly once hard times come to an end.

However it is a mistake to imagine it is all about economics, or even ‘culture’. One of the unfortunate consequences of the culture vs economics debate over populism is the implication that one way or another views are deterministic, and the only issue is what kind of determinism. The reason I go on about the media so much is that information matters a lot too. Although people may be anti-immigration because they have xenophobic tendencies which are reinforced when times are bad, they can also be anti-immigration because they have poor information, or worse still have been fed deliberately misleading facts.

In my intray of studies to write about for some time has been this paper by Alexis Grigorieff, Christopher Roth and Diego Ubfal. (Sam Bowman reminded me it was there from this piece.) It is well known that people tend to overestimate the number of immigrants in their country. This international experiment showed that when people were given the correct information, a significant number changed their views. What is more, this change of view was permanent rather than temporary. Here is a VoxEU post about an experiment from Japan pointing in the same direction.

As well as emphasising simple information like this, politicians should expose the kind of tricks people promoting tougher controls on immigration play. The public tends to be receptive to the idea that it is beneficial for the economy to have immigrants with important skills, so they switch to calling for controls on low paid, low skilled workers. As Jonathan Portes demonstrates, that in practice can involve plenty of pretty skilled workers. The trick for pro-immigration politicians is to ask which occupations do we want to exclude: nurses, care workers, construction workers, primary school teachers, chefs? With UK unemployment relatively low, there are not many jobs where employers are not complaining of shortages.

Of course most people want to stop immigrants coming here and claiming unemployment benefit. This is why newspapers keep playing the trick of talking about the large number of migrants ‘who are not employed’, conveniently forgetting to mention that this includes people like mothers looking after children. In reality unemployment among EU immigrants is below that among the native population. In addition, we can already deport EU immigrants that remain unemployed under EU law if the government could be bothered to do so.

For politicians who do want to start making the case for immigration, the place I would start is public services. Few economists would dispute that immigrants pay more in tax than they take out in using public services. Yet most of the public believe the opposite. In this post entitled ‘Is Austerity to blame for Brexit’ I show a poll where the biggest reason people give for EU immigration being bad is its impact on the NHS. Getting the true information out there will have a big effect. Just as public attitudes to austerity can change, so can they over immigration, but only if politicians on the left start getting the facts out there.

[1] To be fair, whether I would have been right in 2014/15 if Labour had taken a clear anti-austerity line we do not know.   

Did centrism beget populism?

Warning: amateur political science below

Stewart Wood has a well argued piece in the New Statesman, saying that it was the move by left and right towards a common centrism that laid the foundations for populism. Although parts of his argument ring true, I find others less convincing..Labour certainly moved to the centre and beyond in terms of its economic policies. The Conservatives moved to the centre in terms of social policy. But on economic policy, the Conservatives moved strongly to the right with austerity. Senior Labour thinkers still seem to have a blind spot on austerity.

Let me start by looking at the country that now has populism in spades as a result of electing Donald Trump as President. To argue that the Republican party has been moving to the centre over the last 30 years is obvious nonsense. The traditional centre right virtue of fiscal rectitude went out of the door with Ronald Reagan, and was completely ignored under the second Bush. The Republicans only extol the virtue of cutting budget deficits when they are not in power. When they are in power, they want cuts in taxes for the rich, increases in military spending but cuts in other government programmes.

Margaret Thatcher was considered pretty right wing when she was in power. Many of her key achievement in terms of her own agenda, such as a diminished union movement and shrinking the state through privatisation, were not reversed by Blair and Brown. It is difficult to argue that the Cameron/Osborne duo made any attempt to undo the Thatcher legacy. Instead they tried to go beyond it, by shrinking the state to a size relative to GDP not seen since the end of WWII. They did it under the pretense that they were forced to because otherwise the markets would no longer buy government debt. This was a colossal deceit. There no evidence that markets were concerned about government debt, and strong evidence that they were not. [1] This deceit should have become clear when Osborne cut taxes at the same time as continuing to cut spending.

Let me use a diagram to illustrate what I mean. [2] (The vertical axis could also be labelled 'identity' as well as 'culture'.) No doubt we could discuss the detail of the size and direction of the arrows, but I think this is roughly right.

In the US, the Republicans had moved steadily in a downward, socially conservative right wing direction, whereas the broad church that are the Democrats have largely remained in the same place (unless you go as far back as the southern Democrats). One possible argument is that this move by Republican politicians helped create the Tea Party. Republicans have always pretended their policies would help ordinary people, whereas in reality they have helped a rich elite. This has laid the ground for a populist leader who was prepared to move economic policy in certain respects away from the right (in particular advocating protectionism). The growing loss of respect of Republicans for their party elite allowed voters to ignore the views of senior Republican leaders in selecting Trump as their candidate.

In the UK David Cameron moved the Conservatives to become much more liberal, by in particular supporting gay marriage. (When I argued in an earlier post that the Conservatives had moved to the right, I was surprised how many comments I got back telling me this was nonsense, and naming gay marriage as the main reason why.) In the UK this left a large gap in this political space, which UKIP - the first successful mass party in England since the SDP - filled. As Jonathan Wheatley showed, UKIP members are social conservatives, but are much more left wing than the Conservatives in terms of economics.

Labour moved to the right under Blair, while remaining socially liberal. I agree with Stewart Wood that this alone was important in preparing the way for populism. As well as the lack of a major industrial policy, they did nothing to curb a rampant financial sector or reverse the gains of the 1% that were a feature of the Thatcher period, a point emphasised by Jean Pisani-Ferry in respect of both the UK and US. I think New Labour’s position is better described as liberal rather than neoliberal: New Labour substantially increased the amount of resources (as a proportion of GDP) going to the NHS, and they also did a great deal to try and reduce child poverty. Labour moved further right (and more neoliberal) as they became more accommodating towards austerity. It was hardly a surprise that party members tried to pull the party back by electing Corbyn as leader.

As I argued here, Brexit was a perfect storm where the economically left behind united with social conservatives. With Labour no longer seen as representing the working class, this allowed the right wing media (with the support of the Conservatives) to help convince the left behind that their problems were a consequence of immigration. The Leave campaign was populist in the sense I describe here: advocating a superficially attractive policy to some that would leave everyone worse off. Much the same is true for Trump, who won the electoral college by convincing the left behind that he really could bring back their traditional jobs, something he will be unable to do in any kind of general way.

So the idea of growing centrism in the US makes no sense, yet it is they who have just voted for a populist President. In the UK it only makes any kind of sense if you think in one dimensional terms.

[1] This is essentially because the Bank of England was pledged to buy whatever it took in the way of government debt to keep interest rates low.

[2] I think the first time I began thinking in this two dimensional way was this post, but more recently I used it to analyse the forthcoming French election.  

The French election and two-dimensional politics

Unless something very surprising happens, the French presidential election will be between Marine Le Pen of the Front National and François Fillon, who recently won the primaries for a collection of parties (essentially the right wing republican party). Fillon’s platform was extremely neoliberal. As Renee Buhr describes here:

“His policy proposals largely indicate a small government, low taxation and free market approach to economic policy, while his campaign rhetoric takes aim at the usual ‘boogeymen’ cited by liberal politicians – government regulations, public expenditures, high taxes and public sector institutions and employees.“

This makes we worried that Le Pen will win.

If you see politics as all about a left/right axis, my concern makes no sense. Choosing someone whose economic policy is very much to the right of the centre/right parties should eat into Le Pen’s support, while those on the left will vote (reluctantly) for the lesser of the two right wing parties. However this one dimensional view is far too simplistic, and perhaps fatally so in this case.

To illustrate why, I want to briefly look at a piece by Jonathan Wheatley, which uses UK politics before the 2015 election. A sample were asked their views on 30 different policy issues. A technique was then used to find a pattern in the responses. The first interesting result was that the strongest pattern was two dimensional: there seem to be two common factors underlying these responses. To quote:

“The first is an economic dimension, drawing on issues such as the mansion tax, the bedroom tax, and privatisation of the NHS. The second is a cultural dimension, drawing on issues such as EU membership, immigration, same-sex marriage and English Votes for English Laws.”

We could say the cultural dimension was about identity, varying from communitarian to cosmopolitan views. He then looks at the political party people supported. Here is the result:

On the cultural dimension, party supporters are where you would expect. But on economic issues UKIP supporters are less rather than more right wing than Conservative party supporters.

I know of no similar analysis that looks at French voters, but this does not matter for the point I want to make. Suppose we use the same diagram to represent a political party's policy position. In that case the area occupied by UKIP in the diagram above does seem to correspond to Front National policies. Their position on the identity axis is certainly well to the south of other parties, but their position on economic issues is far from neoliberal. In choosing who to vote for, the voter will position themselves on the diagram, and look for the party that is closer to them in this two dimensional space. (Of course we cannot use the diagram to actually measure distance, as the implicit weighting between the two aspects is arbitrary, and may not correspond to that of the voter. But the conceptual argument still works.)    

From this two dimensional perspective, choosing a candidate to oppose Le Pen who is pretty right win in economic terms does nothing to capture Front National voters. But more seriously, it risks losing the support of left wing voters. While they may dislike Le Pen because of her stance on immigration and other identity issues, Le Pen is more acceptable in terms of economic policies than a very neoliberal candidate.