I’m So Bored With the USA: Populism Explored

 

“People are strange, When you’re a stranger”

 

 

As populism continues its seemingly inexorable rise, I decided to lift the bonnet.

 

As with all political creeds there are numerous definitions, described in long words. Some claim its origins start in ancient Rome and the fall of their empire.

The term developed in the late 19th century and has been applied to various politicians, parties, and movements since that time.

The historian, Roger Eatwell, wrote that the 19th century Russia, the Narodnichestvo movement which championed the cause of the empire’s peasantry against the governing elites, “are often seen as the first populist movement”.

In German-speaking Europe, the Völkisch movement has often been characterised as populist, with its exultation of the German people and its anti-elitist attacks on capitalism and Jews.

In the early 20th century, supporters of both Marxism and fascism flirted with populism, but both movements remained ultimately elitist, emphasising the idea of a small elite who should guide and govern society.

Broadly speaking, the ideational approach defines populism as a “thin-centred ideology” that divides society into two antagonistic groups: “the pure people” and “the corrupt elite”, seeing politics as an expression of the general will (volonté générale) of the people.

According to populists, no issue is complicated, there are only simple and immediate solutions. Their fundamental Manichaen (1) worldview leads them to select scapegoats, such as elites, immigrants, or people of different religions, such as Muslims or Jews. Finally, populism is characterized by the concentration of power in the hands of a leader who, supposedly, embodies the people.

‘divides society into two antagonistic groups: “the pure people” and “the corrupt elite”, seeing politics as an expression of the general will (volonté générale) of the people’

 

Whilst populism has become associated with hard-right politicians, this definition could include US politicians such as Bernie Sanders and Alexandria Ocasio-Cortez. Although, both are self-described democratic socialists, their populist message tend to place the people in opposition to big business and the very wealthy.

Populism seeks to create a belief by playing on emotions, cultivating nostalgia and selling a dream.

Right-wing populists have much in common; the ruling elites and other political parties are accused of hijacking democracy. They distrust globalization, asserting the need for strong national sovereignty, with special emphasis on national interests.

Cas Mudde (2) argues that what he calls the “populist radical right” starts with the idea of ‘the nation’, based on ethnicity and identity, which mean rejecting foreigners and immigrants.

Truth is often a secondary concern, with number and data amended to suit their agenda. Part of this is the “great replacement” theory, used to denounce Islam as a threat to their country’s cultural heritage. They see themselves as the breakwater against “multiculturalism”, and the guarantors of security and authority in the face of delinquency, criminality and decay.

 

‘Populism seeks to create a belief by playing on emotions, cultivating nostalgia and selling a dream’

 

Populists claim to restore the original meaning of democracy by returning power to the people, and talk of how the traditional parties have monopolised and perverted democracy.

Many see themselves as the defenders of traditional and conservative Christian values. When they do differ, for example, in Holland who have a more open attitudes on social issues, including homosexuality, their tolerance is a response to the “Muslim threat” which as they see it, represents a return to the Middle Ages.

As can be seen both Trump in the US and our own Nigel Farage display most, of not all of the above traits.

At this point I wanted to examine how populism and fascism compare

In the case of “thin” populist ideology the core matrices are: the plain people, self-serving elites, and rule by popular will.

In the case of fascism they are the creation of: the holistic nation, a “new man,” and a third way authoritarian state.

There are similarities, but the underlying ideologically is different. In practice, fascism has borrowed aspects of the populist discourse and style, and populism can degenerate into leader-oriented authoritarian and exclusionary politics.

Much of the above is theory, but, how it is put into practise?

 

‘Populism champions the people, therefore, both communication and propaganda are key tools’

 

Populism champions the people, therefore, both communication and propaganda are key tools.

The internet and the advent of social media has enabled them to have far more immediacy with their chosen audience.

Set-piece speeches and press interviews can be replaced with direct discourse through platforms such as “X”, Tik Tok and Trump’s own “truth social”, which enables them totally control the narrative, and, more importantly, the opportunity to create the narrative.

Brexit was populism in action. A referendum delivering “control” to the people. The “leave” campaign used social media to identify undecided voters, and took control of the narrative with slogans such as “”We send the EU £350 million a week, let’s fund our NHS instead”, and “Let’s take back control”.

If Brexit is remembered as the moment when populism came to the fore in the UK, was our EU membership the catalyst for UK populism?

I would argue no, but it did become the subject that a growing number of voters could coalesce around. UK Euroscepticism has been around since before we joined Europe, but, by 2016 it had taken on a new lease of life as EU borders became more open and workers, personified by Polish plumbers, came to the UK.

The increased success in European elections of UKIP, Nigel Farage’s then party, shows how the subject came to the fore.

In 2004, UKIP polled 16% of the vote with 12 MEPs, by 2009, the party had risen to second place, ahead of the incumbent Labour Party. By 2014 their level of support reached a high water mark in England, where they finished first, gaining 26.6% of the vote, on a low of 35.4%.

Despite this, the elephant in the room was the 2008 GFC. Globally, banks were having to be bailed out at an unprecedented rate, using taxpayers money. In the UK alone, the net cost of bank rescues is estimated at C.£27 bn, according to the OBR.

 

‘Brexit was populism in action. A referendum delivering “control” to the people’

 

Bankers earning millions in salaries and bonuses had proved to not be very good, to not understand what they and their staff were doing, yet they escaped almost unscathed.

If this sowed the seeds of discontent, what came next was the fertiliser.

Globally, central banks cut interest rates to zero, and pumped untold amounts of liquidity into the banks. The intent was to reflate the economy, but the cheap money only inflated an asset bubble almost solely for the benefit of rentiers.

 

Inequality proliferated:

 

• In the UK, the bottom 50% of the population owned less than 5% of wealth in 2021, and the top 10%, 57% (up from 52.5% in 1995).
• The top 1% held 23% (World Inequality Lab, 2022).
• The ratio of wealth to income has risen in the UK from 2.3 to 1 in 1948, to 5.7 to 1 in 2020. Source: https://www.jrf.org.uk/narrative-change/changing-the-narrative-on-wealth-inequality

 

The picture was equally bleak for incomes:

 

• In 2023/24, household incomes fell across the income distribution. Median household income before housing costs was £650 a week in 2023/24, a real fall of £13 a week (2%) since 2022/23.
• Income for households with the lowest 10% of incomes fell the most, by £18 a week (7%) from 2022/23 to £235 a week in 2023/24.
• In 2022/23, 36% of total disposable household income in the UK went to the fifth of individuals with the highest household incomes, while 9% went to the fifth with the lowest.

 

Added to this was the Tory government’s policy of austerity

 

The 2012 Welfare Reform Act led to cuts in multiple welfare benefits, including child benefits, housing benefits and disability living allowance. As a result, working-age adults faced an average annual financial loss ranging from £914 in Blackpool to £177 in the City of London. Spending on education was also cut drastically. While healthcare spending per capita was not directly cut, it was levelled off.

As a result, by 2024, C.14m people (21% of the UK population) lived in poverty, with children and working-age adults facing the highest rates. (3)

This created the ‘left-behind’ precariat marked by low job security, high inequality, and wage stagnation.

Whilst the GFC was the point when all of this surfaced, the problems can be traced back to the 1980s, and the decline in living standards caused by to deindustrialisation, economic liberalisation, and deregulation.

 

‘This created the ‘left-behind’ precariat marked by low job security, high inequality, and wage stagnation.’

 

The left-behind were targeted by what was then UKIP, today Reform, and fed on a diet of scapegoats to blame for their situation. Alongside, the EU, there was an emphasis on globalisation’s role in disrupting established labour markets and fuelling economic dislocation.

In addition to the economic crisis that many were facing, there was, what became known as the “culture wars”. Since the 1970s liberalisation had driven a cultural shift, embracing feminism, gay and transgender rights and multi-culturalism which gradually challenged established norms.

Post the GFC this reached a “tipping point”, provoking a backlash from segments of the population who previously held dominant social positions—particularly older, white, less-educated men—expressed through support for right-wing populism.

All of this now culminates with a populist party, Reform, polling at 31%, 10 points ahead of the Labour government.

YouGov, using multi-level regression and post-stratification, estimates that Reform could win 311 seats if an election were held today, 15-seats short of an overall majority. The model suggests 231 of Reform’s projected seats would be gains from Labour.

The final question is, does populism work? For the sake of clarity, by work, I refer to the cost-of-living crisis, our moribund economy, and crumbling infrastructure and public services.

One of populism’s bête noires is the climate crisis and the regulations that they believe are holding us back.

In fact, the opposite is true. The CBI estimates there are 1m people in green jobs, and the green economy was the biggest success story of the last year, growing by 10% and adding £83bn to “gross value added” – a much faster clip than the rest of the economy could manage. Globally, the green economy is the second fastest growing, behind only the tech sector.

 

‘this now culminates with a populist party, Reform, polling at 31%, 10 points ahead of the Labour government’

 

The war in Ukraine, showed our overreliance on gas. Overnight the price of UK gas tripled, contributing substantially to the ongoing cost-of-living crisis in the cost. Our climate crisis plans favour heat pumps, which use electricity instead of gas, are 3x more efficient than gas boilers and could save consumers hundreds of pounds a year, even if gas prices continue to fall.

A current example of populism in action can be found in Argentina, who’s president, Javier Milei, is the poster-boy of populism.

Farage, described him as “amazing, cutting and slashing … doing all the things he’s done … that’s leadership.”

Tory leader, Kemi Badenoch said: “Javier Milei is the template.” Donald Trump: “My favourite president.”

However, the Argentina economy is now in freefall, investors are taking billions out of the country, and the peso collapsing.

It is so bad that Trump has been forced to pledge $20bn to prop up the country, in addition to a rescue loan from the IMF.

Milei’s story shows how the attention economy can propel the hard right into power. (4) Like Farage and Trump, he doesn’t come from the party system, his background is economics and TV punditry.

He believes that climate change is a “socialist lie”, and said the poor should be “free” to sell their organs. He described the state as “a paedophile in the kindergarten”. Unsurprisingly, he is big on TikTok.

 

‘believes that climate change is a “socialist lie”, and said the poor should be “free” to sell their organs’

 

At its core, his message is extremely right-wing, but delivered with left-wing phrases. Among his most popular targets is la casta, Argentina’s corrupt political elite. “La casta tiene miedo!” (The elite is afraid!). This seemingly contradictory message, is little different to Farage promising to renationalise water companies.

In Milei’s first few months in office inflation fell and the economy stabilised, but, he offered no real solutions for Argentina’s chronic problems of an undeveloped industrial sector and addiction to income from selling basic commodities.

As the economist Lucía Cirmi Obón wrote; real wages plunged, industry has been gutted by import liberalisation and essential state support – from pensions to disability aid – has been slashed.

Meanwhile, Mile, the arch-enemy of the corrupt elite has himself been caught up in a corruption scandal, with his sister – “the boss”, as Milei calls her – accused of taking kickbacks of 3% on government drug contracts. The president’s response to the allegations was first silence, then to claim they were faked by AI, then to argue that 3% was risibly low.

His early success was driven by “chainsaw economics”: slashing government departments, stripping back social welfare and laying off public servants. One survey found that 50% of Argentina’s workers cannot make their pay last the month.

 

‘success was driven by “chainsaw economics”: slashing government departments, stripping back social welfare and laying off public servants’

 

An Argentinian journalist, when told that Farage and Badenoch had claimed to be keen students of Mileinomics, replied: “No, no, no. People in Britain must know: this has been a disaster from which it will take us years to recover.”

Another example of populism in destruction is Trump’s attempts to takeover the Fed, to ensure a Maga Congress, at least for the rest of his presidency, by lowering interest rates to rock-bottom levels.

History shows what this might do; under Nixon, the Fed pressured by the president and Congress repeatedly pulled back its disinflationary policies causing the economy to overheat, with inflation exceeding 12% by 1974.

Bringing it back under 5% took another eight years. Paul Volcker, who was appointed Fed chairman in 1979, increased short-term rates above 20%, creating a severe recession as the cost of subduing inflation. Unemployment at one point surpassed 10%.

There is also Trumps’ crackdown on political freedom via a memorandum authorising government-wide investigations into activists and non-profits broadly connected with “domestic terrorism” – he has recently labelled a decentralised, umbrella movement known as “antifa” with this classification. Civil liberty groups describe this as an attempt to “investigate and intimidate his critics”.

But then, that is only to be expected from a president who said: “I hate my opponent. And I don’t want the best for them. I’m sorry.”

After this weeks sorry scenes in the Manchester synagogue, hate really isn’t the message for a leader to preach!

The follow-up, which will be published later this week will seek to conclude on what populism might offer the UK.

 

 

“Nobody living can ever make me turn back This land was made for you and me.”

 

 

Notes:

 

1. Dualism, looking at things as having two sides that are opposed

2. Cas Mudde is a Dutch political scientist who focuses on political extremism and populism in Europe and the US

3. Poverty rates are measured by having an income below 60% of the UK’s median income

4. The attention economy is an economic model that treats human attention as a scarce and valuable resource, competing for a limited amount of focus in an information-rich world.

 

 

Given that “populism” is the hot political movement of the times, I thought it was time that we took an in-depth look at the subject.

This will be the first of two pieces, and goes back to the beginning, defining and explaining what the movement is, how it compares to fascism, and what it might mean in practice. Within this, there is the inevitable, “how did we reach this point”? Although this covers old ground for this column, it is of fundamental importance as it highlights what populism won’t do for the majority.

If there is one thing that sums up the current mess in this country, it is this: whilst the majority are struggling with the cost-of-living crisis, with 21% of the population living in poverty, Tesco, our largest food shop, has paid out £12.4bn to shareholder since 2021, and the top 200 energy companies recorded profits of more than £30bn in 2024.   

We shouldn’t need populists to tell us what’s wrong, just politicians with common sense and the balls to do something different.

But, this is the UK, our politicians don’t do that, it’s too difficult, and could upset their chances of enrichment when the electorate gets rid of them.

Nothing will ever change…

Lyrically, we start with the Doors and “People are Strange”, which, as populists champion the people, seemed especially apt.

We finish with “This Land Is Your Land” by Woody Guthrie. This is referencing the Prince of Wales who, despite telling us he will modernise the monarchy, seems hellbent on taking us back several hundreds of years, with his decision to fence off a reported 150 acres of Windsor Great Park. Next, he will be offering up cake to the 14m living in poverty.

Enjoy it while you can would be my advice to him

Philip. 

 

@coldwarsteve

 

 

 

 

 

Philip Gilbert is a city-based corporate financier, and former investment banker.

Philip is a great believer in meritocracy, and in the belief that if you want something enough you can make it happen. These beliefs were formed in his formative years, of the late 1970s and 80s

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