On 28 September 2018, Lorenzo Forni of Prometeia invited me to give a short comment on the relationship between ‘populism’ and economic policy-making. Although, I hadn’t thought about that relationship before, I came up with four things I think we might want to consider (in addition to what we might useful think of as ‘populism’ in the context of the question Lorenzo asked). My argument was that populists bring new people into the policy-making process. They also bring a healthy dose of unpredictability. Their messaging on policy issues is not great, which causes problems in a world defined by rational expectations, and they tend to be skeptical toward independent agencies like central banks. Finally, populists are disinclined to international policy coordination. The combination is not wholly bad — sometimes change is for the good! — but the results are often below the promises that populists make to the electorate. The text of the presentation follows.
Author / Erik Jones
The U.S. Mid-Term Elections: A ‘House Divided’
On Tuesday, 6 November, Americans went to the polls to elect members of the House of Representatives, one-third of the membership of the Senate, a handful of state governors, a host of politicians at the state and local level, and a series of ballot propositions concerning local rules and finances (like bond issues for school maintenance) across the country. These elections are called mid-term because they are held midway through the four-year term of office of the sitting national president.
The name ‘midterm’ is misleading, however, because it makes these elections sound like a national contest. They are not. Although the election results will have a strong impact on the performance of the national government, the mid-term elections are primarily local contests. Moreover, despite and perhaps even because of the very prominent role played by President Donald Trump in the campaign, these mid-term elections were even more local than most.
Soft Law, Hard Ideas, and Borrowed Credibility
International political economy used to be about wealth and power. Now the sources of influence and control are more subtle. Governments choose to follow rules that are not enforced, they sign onto policies recommended to them by foreign nationals (or even ‘citizens of nowhere’), and they invite powerful non-state actors to assume control over crucial economic sectors, finance in particular. Three recent books explain why this is so.
Nationalism, Integration, and Bannon’s New Movement
Steve Bannon is coming to Brussels to repeat the success he had during the Trump campaign in the upcoming elections to the European Parliament. He has held high profile encounters with Matteo Salvini, Marine Le Pen, and even Boris Johnson. He has talked to the press, toured the capitals, and now set up his own office, called ‘The Movement’. As he has done all this, Bannon has raised awareness that there are a lot of people in many different European countries who are fearful about migration and fed up with their ruling elites. On the surface, that picture does look a little like the discontent Bannon tapped in the United States. But if Bannon is hoping to use the same arguments and tactics, what will matter more is how Europe is different.
Identity and Geography – Handle with Care
The past decade has witnessed a sudden uptick in secessionist movements in Europe. The uptick started on the western side of the continent with the 2009 Belgian elections, where the New Flemish Alliance emerged as the largest party in the country; further to the east, we might point to the Russian invasion and partition of Georgia. Flemings, Abkhazians, and South Ossetians rarely fall in the same category for analysis. Nevertheless, there is something they have in common that warrants exploration. Moreover, that something is shared by the Scots, the Catalans, and the Russian-speakers in Crimea and the Donbass region.
Historical Memory and the Crisis in Europe
The fast pace of change in European politics has everyone focusing on current events. Behind the scenes, however, politicians are manipulating how we view the past. Since change requires some kind of baseline or benchmark for us to appreciate its magnitude, we need to be very careful about how our memories are curated. The new ‘normal’ is only normalised when we forget just how far we have travelled and when we stop remembering (or appreciating) the lessons we learned through harsh experience.
Brexit is about Britain, not Europe
The British government faced another crisis in the House of Commons this week over Brexit, having found a way to stave off the crisis it faced the week before. Both the country and its political parties appear deeply divided over whether the remain in the European Union or to leave. As we know from the June 2016 referendum, the ‘leave’ voters have a narrow majority. The ‘remain’ voters lost. And while the facts on the ground appear to point inexorably toward a British exit, the choice is still far from settled. The reason for this indecisiveness is fundamental. As the British have learned over the two years, Brexit is about more than just their relations with Europe. It is about who makes decisions in a liberal democracy.
The United States: Odd One Out
As the Trump Administration prepares for the G7 meeting in Canada, the bulk of commentary in the press is focusing on how isolated the United States has become. The aluminium and steel tariffs, the renegotiation of the North Atlantic Free Trade Agreement (NAFTA), the withdrawal from the joint comprehensive plan of action (JCPOA) with respect to Iran, and the repudiation of the Paris accords all combine to create tension between the Trump Administration and its G7 partners. At the same time, the Trump Administration seems more interested in courting China, Russia, and North Korea than its traditional allies. Hence the question is not just what the Trump Administration hopes to achieve but also why it is bothering to attend at all. The answer is revealing both for what it says about the Trump Administration’s approach to global governance and what it reveals about the enduring legacies of U.S. leadership during the post-Second World War era.
Catching Up with Italian Politics
The fast pace of change in Italian politics has left many observers outside the country struggling to catch up. This collection offers a quick overview in bullet points with links to recent articles I have written in case you have interest in learning more. I am going to list the material in reverse chronological order. Most people want to know what is happening and then figure out why. If you are one of those people who works the other way around, I advise you to follow the links from the bottom up.
Lessons from Rome
Steve Bannon came to Italy and was greeted with a full-page interview this Sunday (3 June) in the center-left daily newspaper, La Repubblica. The journalist, Antonello Guerrera, seemed determined to find Bannon’s influence behind the unlikely union of Matteo Salvini’s Lega and Luigi Di Maio’s Five Star Movement (M5S). Bannon would have none of it. Although he admitted to having spoken with both gentlemen and having had prior contact with the M5S, he insisted that the two groups came together because sharing the government between them was ‘the logical conclusion’. The two parties’ leaders were ‘heroes’ for having ‘overcome the concepts of left and right’. That was the only way to meet the demands of an electorate, the majority of which voted ‘against the establishment’. ‘Italians should be proud.’ Now Rome is ‘the center of world politics’. The question now is whether the lessons from Italy’s experience are at all in line with what Bannon expects.