Can Populism Succeed?

Populism has been one of the recurrent movements in US history. The others of contemporary relevance are Liberalism, Conservativism and Libertarianism. Lately there have been several Populist writers who have gained wide notice, including Thomas Frank and Thom Hartmann and magazines like "The Progressive". So it becomes appropriate to question whether a Populist movement can gain any meaningful influence in US politics.

By Populism I mean a belief that the average person should get a fair deal in economic life and that business should not be structured to favor an elite. In addition government policies should be aimed at a fair distribution of wealth and, at a minimum, a living wage for all.

Through much of the 18th and 19th centuries there were enough expansion possibilities in a mostly undeveloped country that many people could strike out on their own and establish themselves. This was further encouraged by the government with various homesteading programs.

Towards the end of the period, however, there arose a group of powerful, concentrated industries in steel, railroads, telegraph and the like which were able to influence government policies to their own purposes. The country got rapid industrial expansion, which benefitted everyone to some degree, but the capitalists got unprecedented wealth and control.

The imbalance led to several "Populist" political movements. Some even had modest success in electing local candidates. The movement never attained national power, however. It did have an effect on the acceptable morality of government and business (the discrediting of the "Robber Barons", for example). This eventually led to reforms at the turn of the 20th Century. These are still regarded as the beacons of the populist movement: food and drug safety laws, child labor laws, anti-trust legislation, and eventually retirement and welfare programs.

Since then there has been a shift away from the populist sentiment in general and it has been replaced by an individualistic, every man for himself, type of attitude. Coupled with that has been a second wave of industrial concentration, this time on a world-wide basis. The result of this has been a new wave of personal wealth concentration both for entrepreneurs and for the "captains of industry".In the age of the Robber Barons most were men who established industrial enterprises and retained substantial ownership. This is the situation for only a small minority of the wealthy now (Bill Gates, for example). Instead, most are selected as managers of existing enterprises, who then enrich themselves at the expense of the employees and the stock holders, and then leave after a short tenure (now averaging about three to five years).

While the criticism has been going on since the end of WWII the companies have only gotten bigger, the wealthy have gotten wealthier in absolute terms, and also as a percentage of the total wealth they hold, and the middle class has stagnated. So, can populism have any effect on these trends?

I tend to be pessimistic for two reasons. First, all populist solutions include some type of wealth redistribution. This may be a rebalancing of the progressive tax code, or a better designed inheritance tax, or increased corporate taxes, for example. In each case the plan is to take money from the wealthy and powerful and give it to the less fortunate. What mechanism would force the wealthy to agree to this when they have all the political power? Well you could answer (as Thom Hartmann does frequently) "the power of the people". This leads to the next point.

Second, the US population has an underlying belief in personal and national exceptionalism. That is, to put it bluntly, everyone is above average. Most people still believe in the American Dream: anyone can grow up to be president (or rich and famous). There are enough examples to sustain this myth. Bill Clinton is the most recent example in politics.

A perfect example of this exceptionalism is the general acceptance of the abolition of the inheritance tax program. People believe that they will be subject to the tax, or that they may be subject to it as they become wealthier. The fact that only 2% of the population is affected by this is obscured by the myth of success. The belief that anyone can become wealthy also limits the amount of class resentment. Very few people want to reallocate wealth from the rich, they just want a little more for themselves. Many studies have shown that most people aspire only to the wealth of the next higher social class. This belief in getting ahead is reinforced by the political dialog of the entire industrialized world. That is the belief that problems can be solved by more economic growth. A rising tide lifts all boats and, as long as my boat goes up a little, I don't care how much someone else's rises.

The result of these two factors is that there is little discontent with the present social and economic organization and, therefore, there is little pressure for a populist movement to succeed in the near future. In the 20th Century those against the concentration of power in a government/industrial alliance lost at every turn. Similarly, those against social programs supporting equal rights and a safety net for the unfortunate were also thwarted. Demographic data seems to indicate that the present rightward attack on social programs may be the death rattle of the libertarian belief in individual responsibility. The young are much more tolerant of social equality and dislike for authoritarian lifestyle control.

What the future of corporatism is, is, however, harder to foresee. So as a practical matter it would seem that those with populist leanings should work towards policy proposals which don't involve wealth redistribution. This also implies an education effort based less on class antagonism and more on appeals to fairness and morality.

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Copyright © 2005 Robert D Feinman
Feel free to use the ideas, but the words are mine.