As the shock of Donald Trump’s victory sinks in, pundits and politicians are considering what it means for the future of America and global politics. It is critical for Democrats to understand why such a divisive and unqualified person was elected again. Have we gone too far to the left and lost the majority of moderate Americans? Or has the centrist neoliberalism pursued by Democratic presidents since Bill Clinton failed to bear fruit, resulting in demands for change?
For me, the answer is obvious. Four decades of neoliberalism have left the United States with unprecedented inequality, stagnation in the middle of the income ladder (even worse at the bottom), and declining life expectancy (highlighted by an increase in “deaths of despair”). I’m holding it. ). The American Dream is fading, and although President Joe Biden and Vice President Kamala Harris have distanced themselves from neoliberalism by adopting industrial policies, they continue to engage with its legacy as representatives of the mainstream establishment. Ta.
While current economic conditions are important, monthly employment and inflation indicators need to be understood in a broader historical context. As the Biden administration emphasized on the eve of the election, the economy looks strong, especially compared to G7 countries. However, this was not enough. Americans haven’t forgotten that Democrats freed up the financial sector (Clinton), then bailed out the banks, and the cost was borne by homeowners and workers who lost their jobs in the Great Recession (Barack Obama). . Moreover, it was Clinton who unleashed globalization, implicitly believing in trickle-down economics that ultimately benefits everyone. The only real difference between Democrats and Republicans on this point is that Democrats claim to feel the pain of those who are losing out.
The tragedy is that Americans seem to have voted for mere chaos more than anything else. Plagued by fears of economic instability and declining social mobility, tens of millions of Americans voted for Trump as a way to “stick to the establishment,” even though many felt that Trump This is because he seems to believe that he supports the
Americans seem to have lost faith in their institutions and belief that the government will do things for them.
He isn’t. President Trump’s first term and the 2024 campaign have made it abundantly clear that he has no intention of enacting the kinds of policies that ordinary Americans need. He supports tax cuts for billionaires and big corporations. Repeal of the Affordable Care Act (Obamacare). and significant tariffs that are essentially taxes on U.S. consumers and businesses. Most likely, the tariffs will be loaded with fraudulent exceptions bought through campaign contributions. And in any case, they are sure to provoke retaliatory action and the loss of American jobs.
President Trump will also create large budget deficits that will lead to higher interest rates and less investment in America’s future. If he and Congressional Republicans implement the Inflation Control Act (which includes provisions to lower prescription drug prices) and repeal Obamacare, Americans will have less access to health care and higher costs.
This is worse than neoliberalism, which at least purports to promote competitive and undistorted markets. Trumponomics is a completely different version of capitalism, run for the powerful, by the powerful, and according to the principle that money matters above all else.
Americans seem to have lost faith in their institutions and belief that the government will do things for them. This is Ronald Reagan’s famous quip: “The nine scariest words in the English language are: ‘I’m a government man, and that’s what I’m here for.'” The predictable outcome of 45 years of Republican (and neoliberal Democratic) campaigning, beginning with . Help. ‘”
The culture war also played a big role in President Trump’s victory. His campaign successfully conveyed the message that Democrats are obsessed with gender, race, and other social issues at a time when most Americans are just trying to get by. Many voters concluded that Mr. Trump would reverse, or at least slow down, the disorienting changes that have long challenged established social hierarchies and roles.
Like nationalists around the world, Trump blames outside forces for America’s problems, from immigration to “unfair” trade. But while it is true that neither problem has been addressed very well, the solutions he proposed would be disastrous for the U.S. economy and the world. It’s unclear how much his voters understood this. Most seem drawn to political theater. They wanted to send a message of dissatisfaction and they did it now.
For Democrats, the message should be clear: abandon neoliberalism and return to the progressive roots of the presidencies of Franklin D. Roosevelt and Lyndon B. Johnson. The party needs to offer a new vision of society that provides education and opportunity for all. Markets compete to produce better products that improve living standards, rather than inventing better ways to exploit workers, customers, and the environment. So we recognize that we have moved from the industrial era to an economy centered on services, knowledge, innovation and care. A new economy requires new rules and new roles for government.
There’s a big difference between this new vision and the tweaks proposed by the Harris campaign, which include a little more education funding and a few dollars to help first-time homebuyers. Articulating a robust program is not easy, but implementing it can be even more difficult. But America’s future depends on whether it is done.
Joseph E. Stiglitz is a Nobel Prize winner in economics, a professor at Columbia University, and a former chief economist at the World Bank.
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