cross Europe the mainstream parties that have dominated the continent for decades are fading. Their memberships are falling. Voter turnout is down. Those supporters they have retained are starved of enthusiasm. Meanwhile anti-system parties gain ever more vitality. The SNP in Scotland, UKIP in the UK, the FN in France go from strength to strength. Their simple messages calling for the repatriations of powers, together with their populist attacks on a ‘detached metropolitan elite’ are winning them growing support.
Here is the paradox – its the successes of the mainstream that strengthened those who want to destroy it. The growing international order has so narrowed the range of policies available to pro-system parties they find it impossible to build electoral appeal.
Why is this happening ? And why is it happening across the whole EU at the same time? Its often claimed that we are witnessing a re-run of the 1930s. Xenophobia and grievance are feeding off an unresolved financial crisis. There are always sections of society that seek to blame outsiders. Social harmony demands they know their proper places.
According to this view we should shut our ears. Populists have nothing to offer but incoherent rage. Every historical process has its losers – they end up as a footnote in the history books. Why should globalisation’s losers be different?
I think there is good evidence that this story is mistaken. The growth of the populists has far more significance than it allows. It results from deep tensions in our political values. Tensions we have ignored until now.
We have reached a turning point in the Europe postwar project. For seven decades we have worked for a stable and prosperous international system populated with national democracies. For the first time we face a choice : healthy democracies or the completion of the international project that has given us peace and prosperity. We can have one or the other but not both.
There are fundamental natural constraints that limit the development of all organisms and all organisations. As each entity develops it becomes more capable but less adaptable. These constraints limit the complexity of every living thing. It is these limits that the mainstream’s political projects are now encountering.
If we keep expanding the boundaries around “populism” to encompass ever more strands of contemporary opinion, support for populism rises by definition.
Measuring their health by the size of their memberships and the strength of identification amongst their voters, mainstream EU political parties should be in the intensive care ward. They used to be vital organisations representing the views of millions of members but those mass memberships are long gone. The flow of hopes and aspirations that once made its way, bottom up, from the grassroots to the leadership has been choked off.
At one time the upper cadres of mainstream parties were drawn from the ranks of activists only moving into politics after working in another trade or profession. In 1945 the UK Labour party had 45 MPs who were ex-miners. Politicians are now far more likely to be professionals who have worked their way up from bag carrier or speech writer. Reaching the top in national politics used to be the summit of an EU politician’s career. Now it is often viewed as a stepping stone to the international level where real power and prestige are seen to lie.
Contemporary politicians of the mainstream have largely given up the pretence of representing their party memberships. Instead they see themselves as tasked with communicating the inconvenient realities of a globalised world back down the ranks, puncturing voter’s unrealistic fantasies.
In fact, the roots of the current malaise lie not in the darkness of the 1930s but in the bright aspirations of the post war generation. It pledged we would never again return to economic depression, political extremism or war. Since WWII there has been a broad consensus for a peaceful, prosperous and just international order. We have built a system for resolving international disputes without resort to violence. We have attained the economic benefits of growing international trade. And we have striven to achieve this with the consent of the population expressed through national democratic systems. Unfortunately, as we shall see, this process is now reaching its natural limits.
To further this project the parties of the right have delivered ever greater levels of international trade. They have opened markets, harmonised regulation and dropped import tariffs. On the way they have agreed a common market, accepted the authority international trade bodies and signed off on a network of international trade agreements. As a direct result, many of the policy options routinely offered by political parties in the 1970s and 1980s have been taken off the table. Parties can no longer nationalise whole industries. They can’t ‘pick winners’ by offering ‘state aid’ to individual companies. They can not protect industries or levy taxes on unpopular imports. Controls on the movement of labour within the EU have been lifted. Immigration is no longer fully under national control.
It is the success of these policies that created a second tier of restrictions on mainstream. The growth of international trade and capital flows has boosted the power of markets. Without barriers to trade uncompetitive industries can disappear entirely in just a few years. The Italian toy industry, and the British textile and ship building industries are long gone. The markets monitor governments closely. Unconventional economic policies can be vetoed by sovereign bond investors. Governments targeted by FX traders or bond ‘vigilantes’ quickly discover the limits of their power.
In response to these pressures politicians have willingly accepted a third tier of restrictions. They have depoliticised economic management by handing control over monetary policy to their central banks. They have accepted supervision of fiscal policy by technocratic organisations like Britain’s Office of Budget Responsibility, surrendering their powers as an offering to the markets.
It is not only the right that has handed away national powers. The Left has matched the enthusiasm of the Right for narrowing the spectrum of policies that any party can advance while remaining pro-system. For 65 years social democratic parties have accepted the processes of globalisation without enthusiasm. In order to re-balance the power of financial markets, the Left has signed itself up to further limitations on national governments. After German reunification France wanted to assert political control over Germany’s dominant economy. The Euro was the result. The countries of the Eurozone signed the Maastricht agreement handing away substantial powers to the ECB. The key mechanism of economic adjustment in the EU – competitive devaluation of national currencies – was abolished.
Across the EU the Left have pushed for controls on employment standards to prevent a ‘race to the bottom’ or ‘social dumping’. There have been demands for legal norms at the supranational level in the ENHCR and in EU law. The range and extent of these laws has expanded over the decades. National policies that seem entirely innocuous can face challenges from human rights or trade law.
Populists : gifted the prime policy ground
Parties are less able (and willing) to offer clear policy alternatives to voters. Whether circumscribed by global and European constraints, or by the inability to identify any clear constituency within the electorate that is sufficiently large and cohesive to offer a mandate for action, parties increasingly tend to echo one another and to blur what might otherwise be clear policy choices. To be sure, there is a choice between competing teams of leaders, but there is less and less choice in policy terms suggesting that political competition is drifting towards an opposition of form rather than content. Competition is often akin to the competition on show in football matches or horse races: sharp and exciting but ultimately lacking in substantive meaning.
In short, the history of Europe since WWII is one of national governments handing away their powers for the greater good. The mainstream parties have happily accepted constraints on their freedom of action in return for constraints on others. But their enthusiasm for this project has blinded them to its eventual destination. As the policy ground available to them shrinks, all mainstream parties are slowly becoming identical in the eyes of voters. Elections lost their function of deciding between the manifestos of rival parties of the mainstream. At first, they simply decided who would govern – party manifestos contained largely the same policies. But then, as the homogeneity of the mainstream encouraged new political actors onto the stage, elections began to become referenda on the system itself, with the massed mainstream parties on one side and new anti-system parties on the other.
The parties of the European mainstream have come to resemble a colony of animals on an island surrounded by rising floodwater. As the territory available to them gets smaller they find themselves crowding together at its apex. Their party programmes merge into a uniform mush. Meanwhile out on the water, on terrain they only recently vacated, the anti-system parties splash about happily. Their freedom of manoeuvre grows as the tide washes them inwards from the lunatic fringe towards the plum policy ground the mainstream has surrendered to them.
In the 80s and 90s the Front National in France was an explicitly racist and anti-semitic party, now it is simply the anti-EU party. As recently as the mid-1980s the mainstream UK Labour Party opposed Britain’s EU membership, now that position has been taken by the populist UKIP. It is likely that if any mainstream EU party stood again on the manifesto it put forward in the 1980s that it would have to do so as an anti-system party, such is the extent of the territory ceded to populists
It is likely that if any mainstream EU party stood again on the manifesto it put forward in the 1980s that it would have to do so as an anti-system party such is the extent of the territory ceded to populists.
Here is the paradox – its the success of the mainstream in developing the international order that has strengthened those who would destroy it. The range of policies available to pro-system parties is now so narrow that they find it hard to build any distinctive electoral appeal. Across the whole continent of Europe we hear the same complaint form the electorate – “All the major parties are the same”. The spectrum of popular opinion has simply failed to narrow at the same pace as the policy agenda’s of the major parties that supposedly represent it. The space for opinion compatible with support for the system, has shrunk faster that the breadth of public opinion.
The globalised system is complex. The case for it is not straight forward. Most voters do not really understand the commitments the elite has signed up to on their behalf. The benefits are abstract and counterfactual, but the costs can be visceral. A person’s sense of the theoretical benefits of the free labour of movement of labour, for instance, can be rapidly undermined by an influx of individuals speaking a strange language on their street. The international system has simply developed faster than the comprehension of voters. But without comprehension there is no consent.
An unintended consequence of building the new international order has been to expand the boundaries around “populism” to encompass ever more strands of contemporary opinion. Support for populism has risen by definition. It is wrong to conclude that we are facing the conditions of the 1930s once again. Equating modern populism with the fascist movements of that era is a misreading of the situation.
A democratic system is not a just mechanism for finding the right answer to social questions, narrowly defined as the most economically efficient solution. It fulfils important social functions like articulating the conflicting interests of social factions and deflating social tensions. Democracy does not exist solely as a talking shop for credentialed intellectuals parade the international consensus. It is also there to give outsiders a voice: reactionaries as well as progressives; the sensible and informed along with the foolish and ignorant.
A basic design principle of any democracy is that it should allow as broad a section of society as possible to participate in the system without challenging to its fundamentals.
Throughout the Cold War many European countries endured the participation in elections of far left parties with pro-soviet sympathies. These parties often achieved substantial support. European democracy was able to survive the challenge of parties supporting an entity that threatened it with nuclear destruction. How is it that it is now threatened by populists whose aspirations are limited to border controls? As our system has developed, it has become far more fragile.
Whether we accept or reject the current order, it is simply not possible for the narrowing of the mainstream to continue and national democracy to be maintained. Eventually voters would be presented, at every election with a straight choice between the status quo in its entirety, or an anti-system revolution. The design of our political system should prevent this question from ever arising.
‘Big is both beautiful and bad’
At the highest level of abstraction we can recast the problem in terms of networks. The end of WWII forms a kind of Day Zero for Europe’s economic, social and institutional development. The industrial apparatus of many countries were little more than rubble. The pre-war institutions were no more. International trade volumes were low. Trade and commercial laws were diverse. Few international agreements existed.
If we were to imagine the businesses, consumers and institutions of Europe as a set of nodes in a network connected by trade, then in 1945 only short range links existed between them. Tariffs and regulations disrupted long range connections between these nodes.
This was a network with high degrees of freedom but low degrees of possibility. On the one hand the collections of nodes that make up a nation were agile, flexible and fully under national democratic control. On the other hand they remained relatively poor without the benefits of international trade. At that time a national political party could stand on a platform of ‘nationalisation of the means of production’ without questioning the political system itself.
But the process of economic development has seen ever more distant connections generated between these imaginary nodes. Now a Finnish furniture designer is more likely to use Italian designed components fabricated in China with contracts under UK law, than local Finnish ones. The growth of these inter-dependencies has caused what the mathematical biologist Stuart Kauffman calls a complexity catastrophe. As the connections within any biological or economic network grow, the densely connected networks becomes less adaptable but more capable. In the language of Network Theory the degrees of freedom fall as degrees of possibility rise.
This is a basic constraint on both organisms and organisations: in the words of the writer Eric Beinhocker ‘big is both beautiful and bad’. The network benefits from its ability to thrive in one set of conditions but it loses the ability to change and adapt if those conditions change.
In the case of networks that constitute our national democracies, they are losing the ability to offer change. This condition has been described as “Post Democracy” -you can change the people at the top, but you can’t really change the policies. But it is the ability to offer a broad range of electoral options within the pro-system mainstream that is a core function of the democratic system.
Degrees of freedom
For the first time it is becoming clear to us that we have to balance the benefits of a complex, connected, developed international order and the disbenefits of constraining nodes at the national level. A rigid system means death for national democracies. According to Kauffman its these trade offs that are the key limit on the growth of complexity in all natural organisms. Those same limits are now making themselves felt in the evolving international order.
There has been a quiet assumption by both left and right that globalisation’s losers would lie down and die in silent awe. This has been proved wrong. We should not dismiss the populists as ignorant reactionaries. In a democracy we have to deal with the electorate as it is, and not as we wish it to be. The growth of populism is telling us something important. It is essential to recognise the trade offs inherent to economic development.
In the long term the range of public opinion may narrow. But in the meantime, however desirable the social or economic goals, if we are to maintain the principle of democratic consent, we must pause the building of the new global order.