In my previous post I talked about economic protectionism in very broad terms, rather than the common definition (protecting a some domestic industry from foreign competition). But in a broad sense any kind of policy that protects certain agents from the full effect of market forces can be seen as a form of protectionism. This would include policies like setting a minimum wage.

If we took an even broader view, any regulation of the market can be conceived as some form of protectionism as it will usually result in protection for some agents. Assuming that markets need rules to function (i.e. that they are “not self-creating, self-stabilising, self-regulating or self-legitimising”), then the main issue then becomes – what rules?

Conventional party lines were formed as follows: right-wing parties advocated for rules that tipped the balance in favour of the owners of capital, left-wing parties campaigned for rules that tipped the balance in favour of workers. Now, a new battlefront has formed between rules that prioritise domestic interests and rules that prioritise free trade and globalisation.

It’s difficult to see where the old and new battlefronts cross, but you could make the argument that with more resources and wealth, owners of capital (in many cases, corporations) side with globalisation (given they operate in markets that have already transcended national borders), while only some workers would benefit from a globalised labour market (i.e. not everyone has skills to offer to the global market) and in any case several factors limit individual mobility including:

  • visa and immigration laws (in general, while markets have transcended national borders, citizenship has not and you could even argue, has become more exclusive),
  • issues of social and cultural-fit, in addition to economic opportunity, and
  • the personal cost of moving to a different country.

Political quadrants

As discussed in my previous post, here’s how I imagine the political ‘spectrum’ today:

Screen Shot 2017-09-15 at 11.59.06 pm

Within each quadrant, politicians will be conservative/progressive to different extents. For example, Trump is probably much more protectionist than Sanders (if we took his campaign rhetoric at face value).

Protectionism tends to be an ugly word. But in the quadrants above, I refer to it in a much broader sense, not just ceasing free trade in order to artificially prop up struggling, weak industries at home. It means giving priority to certain interests above economic interests and freedoms. Most of the time these ‘interests’ turn out to be national interests (e.g. preserving the environmental and social state of the nation), so the point I’m making may be irrelevant if preserving the state of the nation is no longer valued (e.g. if economic globalisation is followed by worldwide labour mobility, dissolution of national borders and transactional/flexible or even no such thing as citizenship other than ‘citizen of the world’). Conservatism in this sense really means blocking certain transactions or dealings which may be economically beneficial to both parties, but may violate other principles. These transactions or dealings could be:

Late capitalism: the weakness of western liberalism

Where do major parties stand now?

In a previous post, I wrote about what it means to be liberal on different fronts, including the difference between being culturally and socially progressive and economically progressive.

Formerly, major parties in western democracies largely differed in the extent of national economic liberalism they promoted. By national economic liberalism, I mean economic liberalism within a country. Left-wing parties supported workers and unions, right-wing parties supported big businesses and the owners of capital. Both sides were not particularly engaged in social or cultural rights, though perhaps right-wing parties more openly supported traditional social structures as time wore on.

Early capitalism was about economic liberty within a nation, and that’s how major parties aligned themselves – capital vs labour. However, when this “low hanging fruit” was picked, capitalism became less about capital vs worker and more about globalism vs protectionism, where the remaining gains lay. Most western major parties, whether left or right are largely pro-trade.

The negative effects of globalisation are only really being felt now (e.g. GFC, Brexit, Trump), but major political parties have been slow to re-align themselves along the globalism/protectionism spectrum.

Compounding this issue is the confusion over where major western parties stand on social and cultural liberty. While most major centre-left parties identify as socially progressive, at times this has jeopardised the support from their traditional voter base (blue collar workers).

Currently, major parties in western democracies tend to be either:

  1. Pro-globalisation (economically liberal) and socially progressive e.g. Democrats, or
  2. Pro-globalisation (economically liberal) and socially conservative e.g. Republicans, LNP

While the old capital vs worker division still exists between major parties, that division no longer meaningfully captures the biggest issues facing people living in western societies.

The common ground between Trump and Sanders

Lots of journalists have analysed the similarities between Trump and Sanders before. My understanding of their political alignment is that

They differ from major parties because they recognise that western countries are now at a stage where pursuing more pro-globalisation policies may do more harm than good. This is a difficult message to sell, possibly because

  • globalisation made so many people richer
  • free trade is the logical extent of capitalism, which in many ways has also become a moral way of living
  • protectionism has nationalistic connotations, and extreme nationalist countries in the past have limited individual cultural and social freedoms

Rebalancing freedoms: economic conservatism and social progressivism

Is the strongest society one that strikes a stable balance between individual freedoms and social cohesiveness? We’ve seen 20th century communism collapse because the balance was too far in favour of social cohesiveness. Maybe the problem with western democracies now is that the balance is too far in favour of individual freedoms.

But what kind of freedoms? Australia is currently conducting a same-sex marriage postal survey and among other reasons for voting no, is the broader concern that certain freedoms should not be allowed in society. This argument does not conceptualise and engage with same-sex marriage as a basic human right, and on its own logic fails to be convincing if same-sex marriage is the kind of freedom that society can absorb without affecting its fundamental “cohesiveness”.

In fact, such cultural and social rights have only been actively explored in mainstream politics since the 70s or 80s. Capitalism, and by this I mean economic liberalism, has had a much longer run time. If there is a critical threshold at which too much freedom becomes bad for society, then I think an argument can be made that this threshold has already been breached but not in relation to social and cultural rights. If western liberalism is retreating it is because we have afforded individuals and other economic agents too much freedom in the market.

A lot of social frustrations and instability stem from the lack of real wage growth and the growing wealth divide in developed countries. In terms of identifying the weakness of western democracies, expanding social and cultural freedoms is at best a distraction from the real issue, and at worst used as a scapegoat for the decline of western societies.

Initial thoughts on a Trump presidency

These are some of my initial thoughts because I’m still digesting the many different narratives going off in my head.

Firstly, this is not the time for hubris and self-pity. People lamenting ‘what have we become’ reveal a deep ignorance of some of the biggest issues facing America. Likewise, they have also lost touch with a great part of their country. The ‘America-is-the-best country’ mentality has also played its part in this ignorance and discourages any critical reflection on what is actually happening. People who are claiming they will decant to Canada are not only ignorant of these problems but refuse to engage or deal with them in any way. There has been a loss of American solidarity.

Claiming that these people are stupid, racist, homophobic and sexist also drives a deeper wedge between that part of America that is educated, employed and urban and that part which is poor, rural and left behind by globalisation. It obscures the problem of why these people voted the way they did, and consequently the problem will continue to be ignored.

These attitudes and flash judgments are also no better than racial and sexist prejudices. Clinton supporters bemoan that racists have taken over politics, but many people voting for Trump aren’t primarily doing it because they hate gay and black people, but because they don’t trust the establishment and because no one has done anything about their impoverished, rural community.

Secondly, I am incredibly sad about the result. I recognise that Trump is a misogynist etc. and I realise that to an extent, his presidency will legitimise these attitudes and is a big step backwards. That’s why it’s even more concerning that the people voting for him were willing to overlook this. Some have quoted him as an imperfect deliverer of change in America. Desperate, these people will take Trump as he is, as long as America really does become great again. The silver lining is that maybe this will be a big wake-up call to those who live in areas more like Wall Street and Silicon Valley and less like Middletown, Ohio. It could, conversely, just further divide the country, and that will be a sign that America has not learned its lesson.

Thirdly, (this can be a major player and I’m not just offering it out of consolation) the GOP now controls the Senate and House and having spent the entire campaign distancing themselves from Trump, it’s hard to see how Trump will get many of his promises through Congress.

Hillbilly Elegy

I just finished J.D. Vance’s book Hillbilly Elegy and have three thoughts to offer.

1. There is a strong connection between privilege and social mobility

Social mobility is an equaliser. If it’s easy to move from one social class to another then we might conclude that a society is fairly equal and meritocratic.

However, there is a strong connection between privilege and social mobility, and I mean all kinds of privilege: wealth, educated parents, a loving and stable family and a safe neighbourhood. I identify with Vance on some level because I’m also a child of poor migrants. But I’m incredibly luckier because the statistics were on my side. My parents, though poor migrants initially, are both tertiary educated. They value education and provided a caring and secure family home. Vance on the  other hand is the first person in his family to go to college; his father gave him up for adoption and his mother is a drug addict. He attributes much of his success to the love of his sister and grandmother and the fact that his grandmother (and when she was sober, his mother) cared about his education.

He admits that this is probably the only thing that changed his life’s trajectory. Otherwise he went to the same school, grew up in the same neighbourhood, witnessed the same fights and crises that other kids in his town saw.

Parents should love their kids, but I’m beginning to see that a loving and caring family is almost a privilege in those areas, because when everyone’s parents are poor and uneducated, kids with parents who are still willing to invest in them the only way they can (i.e. by providing a loving family home) will probably go furthest.

The problem is this: can you provide a stable home for your child when you’re a single-teenage parent? Will you love your kids if you’ve never known love from your own parents? Poverty is like a disease in these families; it gets passed down through generations.

2. Pessimism among poor, working class whites results from a complicated mix of poor life choices and factors outside of their control

Vance is still figuring out whether the balance is in favour of the individual or forces outside of their control. He blames his mother for not being able to quit drugs but at the same time he admits that she grew up in a violent household. A lot of people he knew who failed did so because of their own choices, and he cites a guy he used to work with in a tile factory who eventually lost his job because he was always late to work and would take 1 hr toilet breaks. When he lost the job he turned against the boss and said he couldn’t be fired because he had a pregnant girlfriend to look after.

Yet at the same time Vance recognises that there are rarely any examples of happy families to look up to, and rarely anyone in the community to show a kid that if you study hard you will get somewhere. People are disillusioned with hard work because they don’t see the rewards, and they don’t feel like they can control their own lives. This leads to a high level of pessimism among working class whites. For example, working class whites are more likely to believe that their children will do worse than them, compared to African-American and Hispanic parents.

In the end, Vance says that a community can either empower people with a sense that they can control their own destiny or encourage them to take refuge in resentment at forces beyond their control.

3. Politicians have capitalised on this resentment

Politicians like Trump, Farage and Le Pen tap into this resentment and blame the white-working-class-plight on immigration, globalisation and a corrupt political establishment. People are call this the rise of populism, perhaps best defined as a type of politics that

scorns elites and experts. It supposes that the purpose of politics is to act on the will of the people, and it proposes simple solutions to complex problems that require serious and effective policy responses

In the end, these simple solutions are not going to help poor working class whites. We need to communicate that, instead of ignoring their problems because we disagree with its political manifestation. Schemes like vote trading undermine democracy and further belittles the political voice of what is already one of the most disempowered groups in America. We label them stupid, racist, sexist and homophobic. But we don’t recognise that they are just very poor, and no one has done anything about it for too long.