This blog has repeatedly argued (see this, this, this, this, and this) on the need for the progressive and centrist parties to break free from the grip of the educated and the business interests.
Reinforcing this point is Thomas Piketty in an interview by Joel Suss. Piketty identifies three big ideologies since the industrial revolution - nationalism, liberalism, and socialism.
The nationalist side is what you see with all the anti-migrant movements in France, in Britain, et cetera. Trump is certainly a nationalist, both on the anti-migrant, ethnocentric dimensions, but also in his sort of extractivist discourse with respect to the rest of the world. The pure liberal, pro-business camp has been weakened considerably by rising inequality and stagnating middle class income. These days, I think you cannot be re-elected anymore with a basic pro-business agenda. Look at the Conservative party in Britain — the electoral base that’s going to be happy with this is so narrow that you will never be re-elected. This is why the right-wing party [Reform UK] and even sometimes a billionaire like Elon Musk are turning to the sort of nationalist, anti-migrant, anti-left discourse because they feel this is the only way — to put it in a very cynical manner — to try to get the popular vote.
Then you have the democratic socialist side, you can call it the left-wing or more egalitarian side. This political family has been incredibly successful historically. It has built the welfare state and brought prosperity and equality to an extent that nobody could have imagined a hundred years ago. But they have sort of stopped thinking about the future. They have become in some cases just a force of conservation, of defending the welfare state, defending the social system.
He makes an important point about the agenda of wealth redistribution.
It’s just a practical, rational question of how you share the wealth, how you share the tax burden, how to share power. And I think, historically, the building of the welfare state system, progressive taxation — this is not a populist achievement, this has been a rational, socialist, democratic achievement, which now nobody is questioning… Every time you have a party that is trying to push for equality and redistribution you also always have some elite who try to portray this party as populist.
And why the discontent from widening inequality and stagnating living standards has been captured by the right-wing populists, despite their coalition with the corporate interests.
I think the left has not been very good at redefining its agenda for several reasons. The main reason is that the left has been a victim of its own success. The welfare state has become a reality — nobody really wants to return to a situation before [the] first world war where total tax revenue and public spending will be less than 10 per cent of GDP. Now the only question is: do we stabilise it at 40 or 50 per cent in some European countries or do we keep going up… The other reason is educational expansion. Because it was successful, it has built a new class of highly educated people voting for the left… But if you grew up in a small city or small village, it’s just more difficult to access universities than if you grow up in a large conurbation, for a given parental income, given social characteristics. For all sorts of reasons… the allegiance to the left in this process of educational expansion has turned around completely — it used to be the case that the less educated would vote for the left… so the left has to redefine equality in access to education which makes people with lower social class origins, and particularly people in the smaller cities, feel more respected.
It’s not just about education; it’s also access to hospitals, access to public transportation. It’s easy to criticise people who use their car when you have the metro in London. The entire movement of educational expansion, health expansion and also ecological concern has created a new educational divide and territorial divide. This is where the left has been in difficulties. One thing that we observe today throughout western democracies is that you have this disconnection between the income cleavage and the education cleavage. For a given income, when you move up in education you actually get more left in terms of vote. And for a given education, when you go up in income you turn to the right. The two dimensions used to go together but they don’t anymore. The other big transformation is this territorial gap [inequality between regions] which has returned to levels we have not seen since the early 20th century.
He has some advice for the socialist side,
I think they need to rethink, to have a new agenda for the future — more internationalist and also more egalitarian. This will have to come with a very strong compression of inequality and power and wealth distribution. I’m not saying it’s going to be easy, but the alternative is the nationalist side right now, because the pro-business, liberal side has been weakened by rising inequality and stagnating median income… The UK Labour Party has to move left in terms of economic and fiscal policies because the UK has so many parties on the right already. You cannot compete with the Conservative and Reform parties on the right.
Piketty has a striking factoid about inequality in France.
In France, the top 500 wealth holders used to collectively own €200bn in 2010. Now they collectively own €1,200bn — it’s been multiplied almost by six. Of course, GDP per capita, average wage or even average wealth has not been multiplied by six over this period.
Piketty’s central point is that the mass base of the pro-business centre, the liberals, has shrunk so much as to make them unelectable on their own. They must ally with the nationalists or socialists to be able to fashion an electable coalition.
This is a return to the old left-right paradigm. The centrist liberal agenda emerged as a synthesis of the duelling thesis of the right and anti-thesis of the left. The changes in the economic structure, nature of work, trends like globalisation, etc., have now weakened the centre and created the space for the return of the old right and left. While the right has mobilised its coalition to be back as an electoral force, the left is struggling to mobilise and respond electorally. The thesis in the form of the nationalist right has emerged and is awaiting the return of the anti-thesis in the form of the socialist left.
Piketty makes an important point about how the success of the thesis will create the seeds for hastening the emergence of the anti-thesis.
Let’s see when the nationalists are in power how they are going to cut spending, because in practice, even if you cut everything you’re giving to migrants, that’s not that much. That’s not going to get you money for the health service and universities. This nationalist discourse will become a more right-wing, anti-public spending discourse. That will contribute to making the political system return to a left-right system, which to me is the most promising way to make social and economic progress. Not because the left is always right and the right is always wrong — both sides have different viewpoints and different economic experiences to bring to the democratic table.
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