2016 Post author By Kevin O’Rourke Post date February 24, 2017 My latest Critical Quarterly column, on the political upheavals of 2016, is available here. Categories In Brexit, EMU, European economy, European politics, Political economy 19 Comments on 2016 ← The Apple Appeals → European Aviation Conference coming to Dublin on 13-14 November 2017 19 replies on “2016” Any chance we could get free access to this article? I’m directed to a number of payment options when I try to read the full document. The Euro is a currency without a country. Unless we create a country its goodbye Euro; http://richmedia.lse.ac.uk/publiclecturesandevents/20121128_1830_theEurozonesDesignFailures.mp3 The eurozones breakup has been imminent for a decade now. Call me when it’s immanent It is supposed to be free to view; in the meantime I have changed the link so it can be freely accessed. I doubt if economic factors are the key issue in the lurch to the non-traditional right in many countries. Those who say it is produce no evidence that its so. Although its (thankfully) now rapidly declining, between 2009 and 2014 unemployment in Ireland was much higher than in other EU countries and north America, and the long-term economic outlook was (wrongly) perceived to be much worse than in other EU countries and north America. Pessimism and despair reigned (not least on this site). Yet Ireland did not produce a UKIP, a LePen, a Wilders, or a PEGIDA. Why? In addition, we have to ask why this political revolution (by which I mean the swing to the non-traditional right) did not happen in 2008-2012, when the Great Recession was in full swing globally. Why is it happening in 2016 and 2017 when most countries are enjoying recoveries (in varying degrees) from that recession? Why didn’t a Trump emerge in the U. States in 2008 when the economy had crashed rather than in 2016 when the economy was back to near full employment? Why is LePen a much more serious threat in 2017 than in 2012 when even in France the economic outlook is better now than then? And why is this political revolution most pronounced in northern Europe and the U. States rather than, say, in poorer mediterranean countries, where the aftermath of the Great Recession has been slowest to dissipate and unemployment rates are much higher? By any measure the Netherlands is doing much better economically than, say, Portugal. So, why is it in the Netherlands that a Wilders is leading the polls rather than in Portugal. And why is there now a swing towards the centre in Ireland (increasing poll numbers for FF and FG), yet a lurch towards extremism in the U. States (Trump), U. Kingdom (UKIP and Brexit), France (Le Pen), Germany (PEGIDA), the Netherlands (Wilders) and many others? Can it really be explained by differing growth rates, unemployment rates, levels of inequality etc? I doubt it, I’d say its more to do with cultural factors. The extremely high level of immigration from Islamic countries into a demographically already-declining Europe (and, to a lesser extent, north America), at a time when a substantial faction within Islam has declared and is carrying out war on the Christian world, has been a key factor in the rise of the non-traditional right. Immigration is frequently beneficial to countries. However, this depends on (a) the immigrants being reasonably culturally and religiously similar to the indigenous population to the extent that within a generation or two they will merge (b) that the numbers are kept within reasonable limits (c) that the immigrants have no violent intent towards the host country. Thus, the immigration of, say, Poles or Greeks to western Europe has little political effect. They share a similar religious background with the indigenous population, will inter-marry with the indigenous population, and within a generation or two will become indistinguishable from them. They also have little tendency to carry out acts of violence. And the numbers are limited. It was the same with Irish immigrants to the UK and north America. They merged in within a generation or two. Every taxi driver in London seems to have an Irish grandparent, although they themselves would never think of themselves as anything other than English. The key catalyst was Merkel’s decision to bring in over 1 million Islamic immigrants from middle-east war zones in a single year, with the prospect of that being repeated every year. Without that decision its likely there would have been no Brexit, no Trump, and LePen still stuck on 15%-16% of the vote. This on top of already very high levels of immigration from even those middle-east and north-African countries not threatened by war. When we consider that the number of births in Germany is just half a million a year, the enormous scale of that level of immigration becomes obvious. Factor in the collapse in the birth rate among the indigenous formerly-Christian population in Europe, and combine it with the unprecedented levels of immigration from nearby Islamic countries, and there is a real prospect that Europe could have an Islamic majority by the end of the century. Many on the left think this is a wonderful prospect and actively welcome it, but it was foolish to think that the total transformation of Europe from what its been for 2,000 years wouldn’t produce a reaction. You won’t find reasons for the political revolutions of 2016 if you keep looking in the wrong place. The left – and I consider myself leftist in outlook – is tying itself in knots trying to find reasons for Brexit and Trump. The Brexit/Trump movement has not been replicated in Ireland but Aidan Regan on this site argued recently that it COULD happen if we all got jealous of the well-off foreigners working in the tax-dodging multinationals in Ireland outbidding us for rental properties and so we have to ensure that there is more redistribution of wealth. I have loads of English cousins. Two cousins from the same family visited me last year; one before the Brexit referendum and one post-Brexit. The first pre-Brexit visitor lives in London in a prosperous area and manages the bar and catering facilities in his local cricket club. He argued at my dinner table that Britain could have the same trade deal as Switzerland and Norway without having to accept being ‘dictated to by Europe’. He was very pro-Brexit and is a regular visitor to Ireland and travels widely around Europe. His older sister stayed with me in July after the Brexit referendum and she was equally in favour of Brexit. She has a house in Wimbledon where her two sons live. She herself is now a Swiss citizen having worked for many years in Geneva with a US multinational. She owns a house in Verbier where she lives and crosses the border weekly to France to do her shopping. She is retired now and travels widely around Europe and speaks French, Spanish and German. She and her current English-based partner have a small food business importing French food products into Britain. In my opinion it would be hard to find someone more ‘plugged in’ to Europe. We had a pretty heated argument over Brexit and she maintained that now that Britain was free of Europe it could do its own trade deals especially with its former colonies. She says her Italian friends also want to be rid of ‘Europe’ also. Neither of my cousins fit any stereotype of the Brexit voter. Both are/were successful in their jobs and travel widely in Europe. When I pressed my female cousin more it was obvious that it was a pure nationalist feeling – even though she lives in Switzerland for God’s sake. When my aunt moved to England to work as a nurse during WWII she met and married an Englishman who was being treated for wounds incurred serving in the British Army. My cousin believed that her father did not fight for Britain only to see it being dictated to by Europe. Rising wage inequality has nothing to do with it. Poor economic performance has nothing to do with it. Globalisation has nothing to do with it. Immigration had nothing to do with it. @ Elia The Economist reported last July: Where foreign-born populations increased by more than 200% between 2001 and 2014, a Leave vote followed in 94% of cases. The proportion of migrants may be relatively low in Leave strongholds such as Boston, in Lincolnshire (where 15.4% of the population are foreign-born). But it has grown precipitously in a short period of time (by 479%, in Boston’s case). High levels of immigration don’t seem to bother Britons; high rates of change do. http://www.economist.com/news/britain/21701950-areas-lots-migrants-voted-mainly-remain-or-did-they-britains-immigration-paradox Three decades of anti-EEC/EU propaganda took its toll even though the UK economy performed well for most of the 43 years to 2016. This is from the FT in early 2016: Britain joined what was then the European Economic Community in 1973 as the sick man of Europe. By the late 1960s, France, West Germany and Italy — the three founder members closest in size to the UK — produced more per person than it did and the gap grew larger every year. Between 1958, when the EEC was set up, and Britain’s entry in 1973, gross domestic product per head rose 95 per cent in these three countries compared with only 50 per cent in Britain. After becoming an EEC member, Britain slowly began to catch up. Gross domestic product per person has grown faster than Italy, Germany and France in the 42 years since. By 2013, Britain became more prosperous than the average of the three other large European economies for the first time since 1965. Burned hand teaches best. I have zero sympathy for the shock they are going to get. Brexit is Suez, a UK journalist opined to me. Q mass, delusional, reactionary (in every shade) spasm . And that went spiffing didn’t it. Kevin O’Rourke makes a good point about changing the economic circumstances facing voters, rather than focussing on “deep-seated cultural attitudes.” However, significant change if it happens at all, typically has an impact years after political leaders risk disapproval by trying to upend the status quo. 1. Trump met about 20 business leaders in the White House this week and he asked them to focus on job creation in the US. However, he doesn’t appear to have any plan to boost jobs in the Rust Belt by retraining etc. while Republicans still support tax cuts for the rich and poorer people are likely to be worse off when they produce a replacement for Obamacare. Manufacturing jobs peaked in 1979 and today only two in five workers in US factories are directly engaged in production while about 30% of US manufacturing workers have college degrees. https://fred.stlouisfed.org/graph/?s%5B1%5D%5Bid%5D=MANEMP 2. As Germany has only about 800 listed firms, it has been able to keep a significant amount of manufacturing in the home country while US counterparts face persistent short-term pressure to deliver efficiency gains through offshoring. Real wages rose 14% from 2007 to 2015 and fell in the UK and Greece by about 10%. 3. In the UK the Institute for Fiscal Studies says that by 2021 real average earnings will be below their 2008 level — this hasn’t happened in at least 70 years. However, the National Living Wage last year, the minimum hourly pay that someone over the age of 25 can receive is now about 8% higher than it was in 2008. By 2021 it is forecast to rise to 20% above its 2008 level. About half the rise in UK employment since 2008 has been in one-person self employment. 4. Germany has three times the number of exporters as France and the ratio of exporting firms is comparable with Greece’s. 5. OECD data published last year showed that Ireland at 25% had the highest percentage of low pay jobs in the developed world. “Low-paying” jobs were ones that earn less than two-thirds of a country’s median income and the lack of exporting firms and the related low level of entrepreneurship are factors. http://www.finfacts.ie/Irish_finance_news/articleDetail.php?Entrepreneurship-in-crisis-in-Ireland-Europe-and-United-States-767 @KO’R Useful. Might I humbly add ‘Fear of Marx and the Soviets’: the Welfare State; Social Democracy (bit left) – Christian Democrats (bit right): 1989 collapse of State Socialism and ongoing collapse of Social Democracy as the Neoliberal Free Marketeers run riot with globalisation and unfettered capital flows and feck the consequences; The EU protects the Euro and Financial System rather than Citizenry who is fed Austerity and macroeconomic illiteracy and Greeks sacrificed on the altar of the EMH …. And lacking a Social Democratic ability the Citizenry look to Right wing populism with its well known propaganda strategy of demonising an available Other and whipping up tribalisms …. Locally our tame populists (FF-FG) were and are both ahead of and behind the pack ….. Habermas, Streeck, or Zizek? Long odds on Habermas at the mo; Streeck sees the return to nationalisms; Zizek demands more truly ‘universalist’ globalisation to deal with economic crisis [capital eating up labour’s dinner], savage social divisions, ecological and climate crisis, biogenetics …. Streeck here: How Will Capitalism End? Essays on a Failing System by Wolfgang Streeck (Verso, £16.99 https://www.theguardian.com/books/2016/dec/09/wolfgang-streeck-the-german-economist-calling-time-on-capitalism p.s. Blind Biddy is in the Bogside at the mo … Couple of thoughts: 1. ” Over the course of the past six months, politicians, academics, and commentators have woken up to what has long been obvious: today’s globalisation may also be producing losers, namely blue-collar workers in rich countries.” Politicians, academics and commentators can be very dim. But really,… that dim !? Isn’t it more the case that it is the (often ex-) blue-collar workers who have started to wake up to a part of what has been been going on? 2. “It is only when economic conditions have been deteriorating for year after year after year, and voters have run out of hope and available electoral alternatives, that some of them will make the switch to supporting extremist parties.” What does the research suggest, if anything, about the influence of economic conditions on the popularity of extremist parties once those parties gave gained power (I’m assuming war may interfere with the historical data a trifle)? As an aside to that, I would expect that in the US the Trump administration is likely to blame the press for talking down the country (as all good Enemies Of The People would), the Democrats for frustrating that little bit extra that couldn’t be done – and would have made the difference, President Obama for creating such a Mess! (this is, though just a hammed-up version of a standard political play), and foreigners generally. In the UK I would expect eventual Brexit fallout to lead to a firming-up of anti-EU sentiment from the Brexiteers and press that supported Brexit. In other words a doubling-down in order to try to counter second-thoughts among the public. In the UK: a) the pro-EU Liberal Democrats eradicated themselves as a political force by joining the austerity agenda and putting tuition fees up from around £3k to 9k per year (think (i) big LD student voter base, (ii) working class social mobility, (iii) election campaign pledge opposing fee increases and austerity) b) The current Labour Party makes Michael Foot’s 1983 outfit look like a powerhouse of political influence by comparison In the US the Democrats have come across as jaded and out of touch with swathes of the US electorate. In short, the opposition looks pathetic. Perhaps they also need to wake up. Kevin, 2 comments awaiting moderation: today 4.47am and 8.17am But was it the Brexit or Trump that ‘revealed or awakened’ the dark forces in both countries, or was it the underlying philosophies and economics of the Davos types, that gave us the financial deregulation and the macroeconomic illiteracy (post 2008?) that you refer to? The argument that such people are preferable to Marine Le Pen allows the Davos types, in conjunction with the biased political and economic systems that they represent, to continue as before; and even to congratulate themselves for saving the ‘system’ in 2008. Has there, for instance, been any radical or necessary change in EU economic (austerity) policy since 2008, excepting QE, which is a 2.3 trillion asset support program for the mega rich. As your article makes very clear, the economic system for the past 30+ years, has certainly not worked in favour of large sections of society, who most definitely were not saved in 2008 and subsequently. Those large sections of society increasingly include large sections of middle and lower class people, who are hanging on by the finger nails. I also think that their is not a public awareness of the facts you have presented regarding economic inequality. There may be in economic circles and some political circles, but most media organizations steer away from these issues, as they tend to shine the spotlight a bit too close to home. Grumpy is correct on that point; the public manifestation of awareness of economic inequality has come from the ‘blue collar’ workers themselves; one could even argue that any knowledge at elite, media, or political level was suitably played down, as they went about saving the ‘system’. Often it is when economic conditions start to improve, that voters demonstrate hostility to the status quo. Hence the discontent in 2016 rather than 2009. Why is this? Maybe in really bad times people are too scared to rebel. @JtO: I don’t know if Islamic immigration is quite the factor you seem to imply. First, then hostility in the US has been mainly towards Latino immigrants. Trump’s anti-Muslim mania is relatively recent, and anyhow Muslim immigrants are a relatively small group in the US. Also in the UK, the Brexiteers were focused on EU-immigration. So they showed extreme hostility to Poles and other Eastern Europeans, who for the most part would have no trouble in integrating. Immigration from Muslim-majority countries did not figure in the debate (a) because the hated EU could not be blamed, and (b) racism against non-Europeans is so politically incorrect that a more acceptable of racism/xenophobia against fellow Europeans took its place. As for the paradoxical position of Elia’s relatives, maybe it’s the result of decades of outright lies and prejudice coming from Fleet Street’s finest. One is reluctant to bash the media at this time, given what is happening in the US, but the Mail, Express and Torygraph deserve a good kicking. What David McWilliams wrote in his most recent column: “We have three upcoming elections in France, the Netherlands and Germany where immigration — and Muslim immigration in particular — will be the main issue. In America, Donald Trump has declared his hand. Anti-Islam was one of his central campaign messages. And in Britain, immigration was probably the issue that swung the Brexit vote.” It seems to rather agree with my post above. The question is whether the upsurge in discontent in the western world, and the political upheavals it has triggered, is based on economic factors or cultural factors. The left is desperately trying to argue that its the former and that the solution is greater economic equality, ending austerity, ending capitalism, or whatever. In which case, we need to ask why the discontent is not leading to a rush of voters to left-wing parties. That’s where they might be expected to go if the discontent was about economic inequality. Instead, they are flocking to non-mainstream right-wing parties and its the social liberal cultural elites that are on the run. This tells me that the discontent is more related to cultural factors than to economic factors. The primary cultural factor seems to be immigration from Islamic countries (as David McWilliams suggests). But there is a spectrum of other cultural factors as well as to why voters are turning against the social liberal elites, with which ones are more important varying from country to country. For example, the social-liberal assault on the traditional family (and some of the spin-off nonsense about gender/washrooms etc that we needn’t go into here) has antagonised lots of people who previously would not have considered voting for the far-right. And I agree that in England an additional factor is the growth of English nationalism. I’m not against immigration. In particular, because they share a common cultural heritage immigration from one western Christian country to another can generally be absorbed without too many problems. And even immigration from Islamic countries can be absorbed and is beneficial up to a point. But, its the current level of immigration from Islamic countries to Europe that is the key issue, and one which the social-liberal elites have ignored. Its now on a scale beyond anything ever previously seen and this has aroused fears in many European countries that over the next century they are going to be Islamised. That’s the root cause of the rise of LePen, Wilders and Pegida. The fears are made more real by the demographic collapse in western countries. Assuming the collapse in fertility rates of recent decades is not reversed, then without immigration from outside Europe (effectively Islamic immigration), the population of Europe will fall by half in the next century. So, fears that Christan Europe will give way in a century or so to Islamic Europe are not as far-fetched as many suppose. This is now a dominant theme in many European countries and is in the process of becoming the dominant political issue. Not in Ireland, of course. Up to now, Ireland has largely been sheltered from this demographic upheaval (both because it hasn’t experienced the demographic collapse of its indigenous population in the way that many European countries have and because it has experienced little Islamic immigration). Hence, people here are more likely to accept the left’s naive view that all this political upheaval elsewhere is simply due to people being upset at the rising GINI coefficient. But, if Ireland had half a million Islamic immigrants and parts of Dublin were having nightly riots, who is to say that there would’ not be a LePen or a Wilders here too? For somebody well versed in statistical matters, you appear to have a curious blind spot for the statistical information referred to in the article that is the subject matter of the thread. 1980 to 2014 is a long time to wait for a 1% real wage rise, while the richest make off with the spoils, preaching competitiveness for others at every swag laden step. The essential premise of the article is, imho, correct; ie that verifiable trends in inequality have been the essential factor in political unrest, notwithstanding the influence or importance of other cultural issues. I might also add that your calls for cultural homogeneity would sound a little more convincing, if accompanied by a vision of more collegiality within the cultural nirvana you are hoping for. As for the poorer classes deserting the ‘left’ parties, and in particular Labour parties, I think you have that the wrong way round. ‘Liberal’ Labour, virtually everywhere in the EU, unashamedly deserted the working and marginalised classes, particularly in the Great Recession and since. That ‘Liberal’ labour ran ahead of itself and placed ‘liberal’ issues at the forefront of their agendas, ignoring the bread and butter issues that their erstwhile support base grappled with, is entirely true; but desertion is desertion under whatever banner it runs away, and that running away was not lost on the traditional support base. So who would blame them for looking for new parties to champion their cause. The regrettable fact is there are loads of charlatans, careerists and chancers willing to use that traditional labour base for their own purposes, and at present they appear to be succeeding. But their is a blow back, particularly in the UK, not only with John Major’s intervention, but in the tacit acceptance from David Davis that there may be no deal. [Whatever about the UK leaving the EU, leaving the customs union is a reckless move by reckless people, who have no regard for the consequences of their action.] Major’s understated point that a hard Brexit could force the end of the welfare state, should set a lot of people thinking a little more seriously. Johnson will not be one of them, but when it becomes clear that bluster will not butter bread, he could have a short innings. This is a recent gloomy article on the US — “From work to income to health to social mobility, the year 2000 marked the beginning of what has become a distressing era for the United States.” “The abstraction of ‘inequality’ doesn’t matter a lot to ordinary Americans. The reality of economic insecurity does. The Great American Escalator is broken — and it badly needs to be fixed.” https://www.commentarymagazine.com/articles/our-miserable-21st-century/ Until 1999 median household income and GDP per capita tracked each other but since then they have sharply diverged. @MH Graphic on this hungry 50% here … A new research paper from economists including Thomas Piketty finds that the bottom 50%’s share of income in the United States is “collapsing.” The paper, written by Facundo Alvaredo, Lucas Chancel, Piketty, Emmanuel Saez and Gabriel Zucman, studies global inequality dynamics. And while there are rising top income and wealth shares in nearly all countries, the magnitude varies substantially. In the U.S., between 1978 and 2015, the income share of the bottom 50% fell to 12% from 20%. Total real income for that group fell 1% during that time period. http://www.marketwatch.com/story/income-share-of-bottom-50-is-collapsing-finds-researchers-including-piketty-2017-02-07 Deregulation of ‘derivatives’ in 2000 must also be noted …. Contrasting the experience of the US and the UK is unlikely to throw much light on a complex topic as the two economies have little in common. Looking at the UK in terms of Brexit having been an essentially English phenomenon, on the other hand, is illuminating cf. http://blogs.lse.ac.uk/brexit/2017/02/27/brexit-a-political-and-constitutional-ramification-of-englishness/ It also explains the conundrum outlined by Elia. From my own personal contacts, I have seen the contradiction many times. Those suffering from it invariably concede that there may be an economic cost for Brexit. They also invariably believe that they will not be personally impacted financially. Comments are closed.