Tuesday, July 03, 2018

What The FT Summer Books List Reveals About Politics And Populism

I was browsing through the Financial Times summer reading list this weekend when I was struck by a common political theme. All six books below highlight, in one way or another, the risk of global capitalism undermining national democratic accountability and giving rise to nationalist populist forces.

The Populist Temptation: Economic Grievance and Political Reaction in the Modern Era, by Barry Eichengreen

The FT says this is a lucid book on the contemporary threat of populism, defined as “a political movement with anti-elite, authoritarian and nativist tendencies” which threatens both the US and Europe. The US because there is no effective political response to the unbridled free market. The EU 'because nationalism feeds on hostility to the constraints imposed by a technocratic EU.'

Can Democracy Survive Global Capitalism?, by Robert Kuttner,

The FT comments 'the problem is not liberal trade, but an out-of-control form of globalised capitalism.' They quote the author “If democracy cannot harness capitalism, it runs the risk of subverting itself and giving way to neo-fascist regimes that will pretend to manage the market but more often ally themselves with corporations and substitute ultra-nationalist symbols and scapegoats for reform.”

EuroTragedy: A Drama in Nine Acts, by Ashoka Mody

According to the FT reviewer Mody argues that 'the European elite have implemented an unworkable French plan for monetary union, one that not only lacked the political underpinnings for success, but has also inevitably weakened those underpinnings. The result has been destructive crises, huge economic divergences and great ill will.'

Straight Talk on Trade: Ideas for a Sane World Economy, by Dani Rodrik

The FT highlights Dani Rodrik's argument that countries must be given more breathing room in which to make their own policy choices, even when they are misguided. 'If democracy is put in too tight a straitjacket, the result will be rightwing authoritarian populism. That danger is already very much present.'

Termites of the State: Why Complexity Leads to Inequality, by Vito Tanzi

The FT highlights Tanzi's key concerns. 'Our governments are overstretched and, in some respects, dysfunctional. Yet a plutocratic elite has also emerged, threatening to undermine both our democracy and our competitive economy. This development is partly due to deregulation and globalisation, but it is also partly due to regulation. So is government the problem or the solution? '

Unelected Power: The Quest for Legitimacy in Central Banking and the Regulatory State, by Paul Tucker

The UK and the EU have removed democratic control from monetary policy and given control to economic technocrats and bankers. The FT says monetary policy and financial regulation are 'almost universally carried out by independent central banks.' The reviewer notes that Tucker analyses where and how to delegate these and other responsibilities, and where and when such delegation risks undermining democratic legitimacy itself.'