My wife and I spent the Labor Day weekend in Chicago. It was my first visit; I was impressed by how attractive the city is. I was also impressed by its dynamism and resilience; the industries that originally drove the local economy are essentially gone, and yet the city thrives, and the skyline continues to evolve to this day.
You know that there were plenty of losers as the city evolved, but you never hear anything about them. That leads to today’s question: why did Trump’s embrace of the losers of technological change and globalization succeed, when previous losers went unheard? Here are my hypotheses:
1. Feelings of entitlement have grown as time has gone on. If your job disappeared in the 1920’s, for example, you didn’t look to the government to bring it back; you just moved on. Decades of prosperity and increased government involvement in the economy have changed that; in addition, years of developing roots in a community make it that much harder to leave.
2. The welfare state hasn’t kept pace. Capitalism creates wealth, on an aggregate basis, but it doesn’t come with any guarantee that the wealth will be shared fairly. The alliance between the PBPs and the Reactionaries, whereby the latter provide votes for benefit and tax cuts in exchange for protection from the supposed predations of “those people,” has resulted in massively increased inequality since the early 1980’s. The Trump victory can be viewed as an effort by the Reactionaries to drive a harder bargain with the PBPs. They are likely to be disappointed, and the outcome is going to be explosive.