Politics

Belgium’s debt drift

Ernest Hemingway famously observed that debtors go bankrupt in two ways – gradually, then suddenly.

The good news is that, for now, Belgium is still going bust gradually. Government debt is high and creeping up, but the situation is not yet catastrophic.

The bad news is that amid economic stagnation, institutional gridlock and relentlessly rising spending demands due to demography, defence and debt interest, the country’s polarised political system seems unlikely to put public finances on a sustainable footing unless a crisis suddenly strikes.

Read my latest piece for Brussels Times

Europe Must Fight the Far-Right Surge

After the far right’s gains in the European Parliament elections, mainstream parties can either sit idly by or tackle the problem head-on, as French President Emmanuel Macron seems to be doing. Calling the populists’ bluff offers the best chance of victory by showing how their radical policies could backfire.

Read my latest column for Project Syndicate

A Brexit reset?

Boris Johnson won the December 2019 UK general election on the promise that he had an “oven-ready deal” to “get Brexit done.” But while the UK did leave the EU in January 2020, Johnson’s deal included a deeply contentious protocol governing the special trade status of Northern Ireland. British Prime Minister Rishi Sunak’s successful negotiation of an amended deal with European Commission President Ursula von der Leyen is thus a welcome development – one that could mark a turning point in UK-EU relations.

Read my latest piece for Project Syndicate.

Welcome to a new era of European democracy

With the next few months set to be dominated by unseemly haggling over top EU jobs, starting with the presidency of the European Commission, it may feel like business as usual in Brussels. But if you take the longer view, there are good reasons to hope that EU democracy may be evolving in a positive direction.

Read my column for Brussels Times

Why populism is on the rise & what to do about it

I contributed to a symposium published by The International Economy here.

“Populist” is often used as a derogatory label for any popular political view that someone deplores. But although populism can take many forms, it has a specific meaning: populists claim to stand up for “the people” (their supporters) against the elites (their opponents, whom they tend to view as enemies). Most populists are on the far right or the far left, but they need not be: witness Italy’s heterodox Five Star Movement. And the elites they lambast are often (but not always) economically and/or socially liberal.

Some voters have always hated liberalism and openness. But the main reason why populism is on the rise is that this core support has been swelled over the past decade by a broader constituency of voters who are angry and fearful.

While populists don’t have the answers, voters’ rage against the establishment is understandable. The financial crisis and its unduly austere aftermath have discredited elites, who often seem incompetent, self-serving, out of touch, and corrupt. Both bailed-out bankers and politicians have inflicted misery on ordinary people without being held accountable for their mistakes.

Meanwhile, communities that have suffered from economic change (mostly due to automation, not globalization) have often been neglected. No wonder many voters feel the system is rigged against them.

Populists tap into the resentment of people who feel ignored, looked down on, and hard done by—who have lost status or fear they will. Fears about the future include both economic worries that robots, Chinese workers, and immigrants are threatening people’s livelihoods, and cultural ones that white Westerners are losing their privileged status both locally and globally.

Far-left populists tend to target their fire at billionaires and big businesses that abuse their clout to buy political power and screw workers and consumers. But there is a big debate about whether far-right populism—which focuses its hostility on foreigners in general and immigrants in particular—is driven primarily by economic issues or cultural ones.

In practice, these often can’t be neatly separated. In difficult times, distributional cleavages come to the fore— over access to shrivelled public services, for instance— and are often then overlaid with identity clashes. When people lose status as individuals, they often prize their group identity more. In insecure times, some hanker for the perceived security of leadership by a strongman. In times of economic decline, people are more nostalgic for the past. And so on.

Our age of discontent provides rich pickings for opportunists such as Donald Trump (who was previously a Democrat) and Hungary’s Viktor Orban (who was once a liberal). But successful politicians often are opportunistic: witness Emmanuel Macron, France’s self-styled Jupiterian president who earlier stormed to power posing as an anti-establishment outsider.

To defeat the populists, mainstream politicians need to address the economic and cultural insecurities that create a wider constituency for populism in positive and constructive ways. That includes bold economic policies to promote greater opportunity and fairness and unifying cultural narratives such as progressive patriotism.

How to overcome the politics of pessimism

A big reason why Western politics is in such disarray is voters’ pessimism about the future. 60% of Westerners believe today’s children will be “worse off financially than their parents”. Europeans are particularly gloomy. To paraphrase Hobbes, they expect youngsters’ lives to be solitary, poor, nasty, brutish – and long.

When people doubt that progress is possible, they tend to fear change of any kind. Rather than focusing on opportunities, they see threats everywhere and hold on tighter to what they have. Distributional cleavages come to the fore – toxically so when overlaid with identity clashes.

Western politics can become rosier again, but only if politicians first address the root causes of the gloom. My latest column for Project Syndicate explains what needs to be done.

Don’t believe the hype about Corbyn

I posted the following thread on Twitter earlier.

While some voted Labour cos they wanted Corbyn to win, many did so cos they thought he couldn’t. Doubt he cd win election except by accident

2. Clearly, some in UK r hard left. Many r fed up with austerity. Corbyn mobilised students & some who feel left behind. But..

3. Many also voted Labour cos moderate Labour MPs reassured them Corbyn couldn’t win. Others wanted to deny Theresa May a landslide…

4. In Kensington & elsewhere, rich Remainers who r hardly socialist felt safe to reject May’s hard Brexit. Cosmopolitans rejected nativism.

5. & many other reasons. Many voters would behave differently if they expected Corbyn as PM rather than May (or her successor). Ends

Apart from insults and trolling, the main response was “what is your evidence for this?”. It’s my analysis, and like any analysis it may be partly or wholly wrong, but let me amplify a bit and add some evidence to substantiate it.

It’s clear that very few people expected Labour to win the election – only 12% did, according to a Survation poll just before the election – and Labour indeed didn’t win. That was the frame in which people decided to vote Labour: while some genuinely wanted Corbyn to be PM, those who didn’t want him as PM still felt safe to vote Labour for all sorts of reasons, local (eg they liked their moderate Labour MP), tactical (eg they wanted to deny the Conservatives a big majority), protest (eg they opposed May’s Brexit at any costs) or otherwise. Anyone who thinks that Kensington, one of the wealthiest constituencies in the country, has suddenly gone socialist is certifiable.

Many Labour MPs and canvassers reported negative feelings towards Corbyn on the doorstep and explicitly tried to reassure voters that it was safe to vote for them because Corbyn couldn’t win. Some went as far as writing to their constituents to that effect. See, for instance, this reporting piece in the Guardian (which backed a vote for Labour).

Many people were put off by the choice between a hard-Brexit Conservative Party and a hard-left Labour Party, while the Lib Dems are still discredited by their time in coalition. YouGov’s focus-group findings are particularly telling:

Participants believed that both of the two main parties have entrenched political stances that are further to the right and left than in previous years, and there are perceived to be few options in the middle for those who see themselves as politically centrist. For these participants, the choice for whom to vote is unclear, as they feel ideologically separated from both Labour and the Conservatives. Related to this, many participants were considering tactical voting. Some had a stronger sense of the party they did not want to be in power than the one that they did. Related to a need for more choice, there was both a strong appetite and expectation for a new centrist party to emerge after the election, with France’s En Marche party an example of how this could be successfully achieved.

 

While Corbyn clearly appealed to some voters who might otherwise not have voted Labour, notably students, there is ample evidence that he was net negative for Labour. YouGov, whose model predicted seemingly unlikely results such as Labour winning Canterbury, found that only 34% of voters thought Corbyn was competent and 31% strong (although 49% found him honest and 46% likeable). Survation – whose final poll had the Conservatives on 42% and Labour on 40%, almost the same as the actual result – found only 81% of those intending to vote Labour thought Corbyn would make the best PM.

Now, of course, nobody can know for sure how a future election might pan out. But a coalition of convenience around Corbyn on the basis that he couldn’t win is unlikely to translate into an actual parliamentary majority in an election where voters think he could win. Indeed, so squeezed is the vote for the smaller parties that even if Corbyn could somehow hang on to that disparate coalition of convenience, the only way he can get a majority is by winning votes off the Tories. Good luck with that.

UPDATE on 12/6

A new poll for Survation after the election puts Labour ahead of the Conservatives by 45% to 39%. Does this contradict my thesis? No. What people say in a poll immediately after an election when nothing is at stake tells you very little about how they will vote in a future election when there is a lot at stake for them. For instance, in June 1979, just after Margaret Thatcher won the election, polls put Labour ahead. The test of my thesis is the next election.

Theresa May’s election gamble

Theresa May is likely to win the UK’s snap election on 8 June. A big parliamentary majority and not having to face voters again until 2022 could give her more flexibility in negotiating and implementing Brexit. But contrary to what she claims, that wouldn’t strengthen her negotiating position vis-a-vis the EU; if anything, it would weaken it.

With politics so unpredictable these days, there is also a risk that she will do less well than expected.

And May is taking a much bigger gamble with the survival of the UK. She can scarcely deny Scots a vote on independence before knowing the outcome of the Brexit negotiations, since she is now asking Britons to vote in similar circumstances. With many Scots leery of being dragged into a hard Brexit by a Conservative UK government in thrall to English nationalism, the (emotional) case for Scottish independence could be compelling, as I argue in my latest column for Project Syndicate.

The Battle for Britain

One consequence of the Paris attacks is that Britain’s renegotiation of its EU membership has been delayed. With the risks of Brexit rising by the day, David Cameron’s priority should be to complete the renegotiation as quickly as possible, declare victory, and start campaigning vigorously on the broader reasons why Britain should stay in the EU. My column for Project Syndicate

DÖ stärker SD

My column for SvD on why the December Agreement between Sweden’s mainstream political parties is a mistake. The Sweden Democrats may have been marginalised in parliament, but they have been strengthened in the country as a whole

Britain’s emerging cosmopolitan liberal majority

An excellent pamphlet by Jeremy Cliffe, The Economist’s new Bagehot columnist, explains how a number of long-term trends are likely to create a cosmopolitan liberal majority in Britain. This poses big challenges, and big opportunities, for existing political parties. I wrote a response to the pamphlet for Policy Network and argued in CapX that while Labour might seem best-placed to benefit, there was also a big opportunity for liberal Conservatives.