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No Mobility, No Liberty

posted in: CEC 2017 | 0

Written by: Zsófia Bajnay

The populism section will analyze the ongoing global crisis of democracy and look for possible explanations on what may have caused the backsliding of democracy. There is a vital scholarly debate on whether the Great Recession of 2008 has contributed to the upsurge of populist movements.

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Currently we can see the phenomenon mostly in Eastern and Southern European countries, in the United States and in Latin American countries, which were all subjects to severe economic crisis in the recent decades. In many cases, middle class voters were the most affected with the crisis. Despite the fact that they all enjoy the benefits of a liberal democracy, often at times they support populist parties. In the graph below [1] (also known as “The Elephant”) one can see the real income growth for the entire world population. To make the understanding of the graph easier, let’s imagine that we line up all the people on Earth, based on their income levels and divide them into percentiles. Now that we have those hundred groups, we ask them whether the last 20 years of economic growth benefited them. In short: the graph shows the global decline of the developed countries’ middle class, and I think that many of them may have turned towards anti-system parties.

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Regarding the connection between populism and the economic crisis, another important issue is income mobility. The second graph [2] shows with trends in absolute income mobility in the United States. The chance to earn more than one’s parents did, has been constantly declining from the 1940s, yet for a couple decades it was still relatively high. For those born in the 1980s, however, there is only a 50% chance that they will do better than their parents – “it’s basically a coin flip as to whether you’ll do better than your parents” said Raj Chetty, the author of the study.

These trends paint a gloomy future for the European and especially for the American middle class. Despite having the highest standards of living in the world, citizens of the developed countries may feel that their former hegemony in the world economy is threatened and their everyday livelihood is affected by the global competition with Asian markets or by economic migrants. Populist messages thus resonate well with the scared voters, who long for the return of the post WW2 economic growth.

While the economic reasoning described above seems to apply to a number of developed countries, it is important to note that in other cases it does not seem to explain the presence of populist parties. Despite its fast recovery of the 2008 crisis and very low social inequality, Sweden also experienced the rise of anti-establishment nationalism. The Sweden Democrats – the most popular party by 23.9% as of 2017 March – emphasize national identity and strongly oppose asylum-based migration. Nativist parties and movements with similar agendas can be found throughout Europe, from the True Finns to Pegida and the Europe-wide identitarian movement [3]. The popularity of these groups underlines another possible explanation to the liberal decline: cultural and ethnic cleavages.