If I were playing soccer against the United Kingdom’s Tory party, I’d pass them the ball, because they’d be sure to kick it into their own goal.
Sorry for the snark, and it’s mean to hit them when they’re down, but between former prime minister David Cameron calling for a referendum on Brexit and maybe-soon-to-be-former Prime Minister Theresa May calling the snap election, let’s just say there’s room for improvement in the party’s political judgment.
The reasons the Tories lost their parliamentary majority are, as the political scientists say, “overdetermined,” meaning there’s no smoking gun. But one that shouldn’t be ignored was highlighted a few weeks before the vote by the very wise Torsten Bell, director of the Resolution Foundation, a U.K. think tank. Bell pointed out that weekly paychecks of workers fell from around mid-2009 to early 2015, and then, after growing a bit in 2015-16, began losing ground again this year.
Bell then notes (and remember, he wrote this before the vote, when May was up double digits in the polls):
History teaches us two things. First, that Prime Ministers do not normally choose elections at times like this, and second that when an election happens anyway the incumbent government gets a kicking rather than the increased majority the current polls imply.
Other data reveal a spate of economic challenges faced by workers, all of which are familiar to us over here. In fact, this interesting new figure from the Organization for Economic Cooperation and Development shows that the negative correlation between the decline in manufacturing employment and the increase in regional wage dispersion is about the same in Great Britain and the United States. To unpack that a bit, it’s telling us that the more factory jobs a country lost, the higher income inequality is between regions of the country. Simply put, London, New York and San Francisco are bustling while too many non-metro areas still haven’t replaced the quantity and quality of the jobs they’ve lost in recent decades.
Okay, let’s put aside the correlations and float up to 30,000 feet. What does this mean? Why do major elections and referendums (like Brexit) continue to surprise? Why, amid stable, if moderate, macroeconomic performance (GDP up 2 percent over the past year in both countries), low unemployment (4.3 percent here, 4.6 percent in the United Kingdom), low inflation, and booming financial markets, is their so much uncertainty and insecurity?
I’ve already referenced the inequality problem, which is surely part of the answer because it implies that the overall, macro-indicators are insufficient. When people ask me, “How’s the economy doing?’ ” I ask back, “Whose economy are you asking me about?”
There are also two big “-izations” in play: globalization and polarization, and they’re related. The failure of elites on both sides of the aisle to acknowledge and aggressively try to offset the downsides of globalization have led to a push for insularity against global integration and a polarization that continues to generate political shock waves.
To be clear, I stand firmly against protectionism, but the fact that the debate still essentially reduces to: “either you’re for more trade and immigration or you’re protectionist” is at the heart of the double -ization problem. Ironically, it’s not just the anti-globalists who are pushing back on globalization. It’s the elites’ refusal to countenance any dissent and thus to truly help those who’ve been hurt.
What’s needed is a robust policy agenda to meet these challenges. For some groups, that means bringing ample, remunerative employment opportunities to rural and inner-city places that lack them. The prevailing economic assumption has long been that markets will do so, but at least in the United States, we’ve been at full employment only 30 percent of the time since 1980, and to this day, even as we close in on full employment, there are places clearly left behind here and in the United Kingdom.
Another early lesson from last week’s vote is that young people feel particularly alienated by what’s on offer from mainstream politics. Behind wage and benefit losses, high housing costs where they want to live, and here in the United States, the cost of higher education, they are an increasingly important political force.
Addressing these issues won’t be easy. It’s not obvious how to bring opportunity to left-behind places — I’m increasingly convinced that direct job creation must be part of the answer — and, even more challenging, our politics are in truly terrible shape.
It is now abundantly clear that severe political polarization and its handmaidens — fake news, faux populist leaders, vilification of the “other” — is a tactic that serves the fundamental conservative goal of cutting spending on the poor to pay for tax cuts for the wealthy, a goal diametrically opposed to correcting the failures noted above.
That’s why I made such a big deal about something that happened last week that, amid all the drama, you might have missed. The majority Republican Kansas legislature overrode their governor’s veto and repealed a suite of highly regressive tax cuts they’d enacted in 2012, sold to them by the same architects of President Trump’s tax plan. Predictably, the alleged growth effects from this trickle-down fairy dust never arrived, but the state’s budget took a huge hit and they began cutting services, notably education, that people cared about.
I was particularly struck by this quote from a Kansan described as “a registered Republican who … was never very interested in politics until she and parents at their local public school started to notice a shift.”
“The guys in office are refusing to fix this, and come on, the evidence is plain,” she said. “I really don’t care if it’s a Democrat or a Republican, I just want someone reasonable.”
Amen to that.
I can’t say whether this simple insight represents a chink in the thick armor of dysfunction and division. But speaking for myself and my friends across the pond, I sure hope so.