Why populism prospers

Today's populist leaders, unlike the strong authoritarians of history, maintain political durability by keeping the masses in a state of consensual mediocrity and low self-esteem

Economic development is about achieving increased prosperity. The first tasks involve overcoming calamities, deprivation, and physical insecurity. As countries progress to middle- and high-income status, they seek to increase prosperity over and above the basic state of animal existence

There are two facets to prosperity. The “how” —the means to secure an existence that is predictable, raise children and secure basic needs; and the “what”— the capabilities we want for our children, enjoyment of cultural, artistic and sporting activities, and the ability to engage fully in the society of ones’ peers.

Thus, there are many levels to prosperity, each of which affords satisfaction. The celebration of festivals and the acquisition of clothing and personal ornaments are a universal pursuit. Education, beyond a basic level, allowing engagement in literary and cultural activities, is required only by a few. Football, to play and watch, is universally accessible, whereas “gentlemanly” sports like golf require access to more of the “hows” of prosperity.

When agriculture and manufacturing were the main income-generating economic activities, only those who owned agricultural and manufacturing assets (plus a rarefied few with specialised knowledge and skills) could aspire to higher levels of prosperity. For the rest, a society that provided access to basic needs and reasonable security from calamities was considered prosperous.

With the advance of modern capitalism, a new political ideology emerged, which demanded the democratisation of prosperity. The attempt to democratise access to the “whats” of prosperity was at the foundation of social democratic ideology in its socialist and conservative forms, as distinct from communism and fascism, which, respectively, emphasise hate of the other and class struggle.

This led to a greater emphasis on education and literacy, essential for securing wider intellectual, cultural and societal “whats”. This is why, in India and many other countries, the popularisation of education was a social movement through collective action in society, and through philanthropy, not a technocratic exercise executed by the State. Education involves not just the acquisition of credentials but the attainment of capabilities for a person to enjoy a higher quality of “whats”. Two mass examples are drinking for pleasure rather than intoxication, and the education of children in music and sport. As prosperity increased, the social democratic State endeavoured to democratise access to the “what” — by providing access to all levels of education, building libraries, subsidising sporting and artistic endeavours and so on. This was also the primary objective of philanthropy.

All this was upended dramatically from the 1970s onwards as the social democratic ideological consensus collapsed — a process that has taken over 40 years. The process is complex, but three features stand out in footlights.

First, as Thomas Piketty eloquently documents, the sharp rise in income inequalities has occurred because returns to finance and legacy capital are, for the first time in a century, greater than returns to human capital. In developed countries, this happened after they attained high levels of prosperity. Most developing countries have failed to complete the development transformation. They are stuck in the middle-income trap — economic levels at which low development conditions impact the majority while a few enjoy the benefits of the “whats” with disproportionate access to the “hows”.

Second, the monetisation of the “whats”, made possible by the rapid rise of services and virtual technologies, is making it possible to satiate the basic “whats” of the uneducated low-income majority even while making money out of doing so. For example, cheap but profitable virtual access to sporting events, music, film, pornography and even vicarious enjoyment of the sybaritic weddings of the rich — all profitable opiates that negate any need to think about collective action to secure the same “whats” as the legacy rich. Education, too, is now solely a means to acquire credentials to get more of the “hows”.

Third, globalisation allowed social democratic elites to create a gated global world. Their fellow citizens were no longer peers, just service providers and recipients of welfare. The global elite converse, vacation and celebrate globally, enjoy the delights of sushi and tandoori jointly, and share “woke” values. They have largely abandoned the obligation of public service.  Shared spaces are replaced by gated spaces, so evident in India. This has led to a massive and very real sense of exclusion and abandonment.

It is little wonder, therefore, that fascist and populism are speedily replacing the social democratic consensus. Diminished self-esteem, accentuated by abandonment, provides a fertile seedbed for political mobilisation. This is further accentuated by social media, and ready acceptance of propaganda that offers the opiate of vilifying a primitive “enemy” — be it racial or religious minorities, “immigrants”, and so forth. Populist political leaders show little interest in increasing prosperity by democratising access to the better “whats” of prosperity. However, they have every technological and commercial incentive to encourage increased consumption at scale of the cheaper “whats” to keep their base satiated and their crony capitalist supporters wealthy.

This has happened before in history and shall pass too as the hoax becomes apparent to a slumbering, wounded, citizenry.  But history teaches that this could take a long time because the leaders today are not reminiscent of a Hitler or Stalin, but resemble weak authoritarians like Franco, Marcos, and Salazar. It is precisely because they represent the least common denominator that they reproduce it with political durability and longevity while condemning the populations they govern to a state of consensual mediocrity and low self-esteem.

The writer is visiting senior fellow, ODI, London, and former member, Economic Advisory Council to the Prime Minister of India