AS this column is being converted from thought soup into words on paper, British Prime Minister Theresa May’s gamble to secure a lasting mandate for her conservative agenda is backfiring spectacularly. Although May’s party managed to keep more seats than its Labor Party rivals, it was not enough for a majority in Parliament, meaning that the UK is facing the prospect of being led by a coalition government, something that historically has not gone well, for the first time in 18 years.
May’s loss is just the latest in a string of political earthquakes that have happened around the world in the past two years that have shaken up the conventional framework by which the world has been led: by seasoned politicians backed by institutional parties, and pursuing what we have come to know as more-or-less standardized capitalism.
Justin Trudeau’s election in Canada was perhaps the first departure from the old order, although it was not immediately apparent because he is largely a conventional liberal. Still, his win represented more of a shift in public sentiment than the normal cycle of politics usually does. Rodrigo Duterte’s convincing victory here in the Philippines was even more significant – a provincial mayor with no organized party to speak of and admittedly no real experience in national-level politics shoved aside the political establishment, with consequences that are yet to be determined.
Likewise, Donald Trump scored an unimaginable win against the political class in the US. It seems fairly clear already that Trump is wholly unsuited to the presidency and is going to cause a great deal of harm – an assessment that may also yet apply to Duterte, although it would not be accurate to say that now. But while that may be the case with Trump, it is perhaps not what he – or Duterte or any other political “outsider” around the world who has suddenly found himself in a similar situation – does directly that is most important, but what comes after.
The political world we have all lived in since the end of World War II has several economic characteristics that have, as the recent chaos has shown, passed a point of diminishing returns in terms of social evolution. Money has become a commodity. Poverty, while it has been reduced according to the standard measure (an income threshold of $2 per day), is increasing because the standard measure is outdated. No one seems to realize this, which is why most economists and populist politicians have seized on the concept of “inequality” as the economic culprit keeping people from having dignified lives, even though inequality is a natural and unavoidable characteristic of any economy. It’s not a problem if one does not have as much money as someone else; the problem is if one simply does not have enough money.
Business and entrepreneurial activity, the main drivers of any economy, are being increasingly stymied, ironically because of a more “open” global economy that is supposed to provide greater opportunities for everyone. Regulations have become massively complex and the cost of doing business is steadily increasing, so that only businesses of scale can grow. Capital flows gravitationally; the bigger the business, the bigger its attraction to capital, which leaves even less to help small businesses expand.
Frustration with all of this is what drives the world’s political chaos. People sense there is something very wrong with a world in which the wealthiest entities, either individuals or enterprises, grow wealthier at an exponential rate in a system that seems to favor them. And meanwhile, the great masses of the people, while constantly being told their circumstances are improving, feel no real change.
The leaders promising that change may not actually bring it about, but what they have done is find a way to articulate it in terms the disaffected understand, and which suggest there may be solutions. Even if they fail, they have ruined the chances of the previous political-economic model of being completely restored. Whoever follows Trump, whoever follows Duterte, will not simply be able to point to their mistakes and say, “See, the alternatives are no good, go back to the old ways.” What the “outsiders” have done is made everyone question everything, and that is ultimately a good thing. What comes of that self-examination is up to us.