Global Trumpism - An Economic History, Professor Blyth
A pox on both your houses. In this article, Professor of Political Economy and Political Science and IE Brown faculty member explains how orthodox adherence to policy approaches from both sides of the political spectrum resulted in the rise of Global Trumpism. The post World War II era’s commitment to full employment triggered run-away inflation and threadbare capital returns. Under additional pressure from globalized production and oil shocks, the political pendulum swung in the other direction ushering in an era of neoliberalism. Believers in this regime deregulated markets and rolled back state capacity. Productivity rose, but the returns all went to capital. Now, fears of inflation give way to fears of deflation where the value of debt increases but the ability to pay off those debts decreases. The result according to Blyth,
“In this world, yields compress and creditors fret about their earnings, demanding repayment of debt at all costs. Macro-economically, this makes the situation worse: the debtors can’t pay—but politically, and this is crucial—it empowers debtors since they can’t pay, won’t pay, and still have the right to vote.”
Enter Global Trumpism - the global revolt against elites driven by global economic trends. Blyth concludes, “The era of neoliberalism is over. The era of neonationalism has just begun.”
To read the rest of the article, go here.
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