November 26, 2006
What Is a Populist? Posted by Fredric Smoler at 06:55 PM EST An article in today’s New York Times Week in Review, by one of the Times’s best economics writers, Louis Uchitelle, is titled “Here Come the Economic Populists” and argues that there is now a split in the Democratic Party, with rising hostility to the neoliberal consensus associated with the Clinton administration generally and with former treasury secretary Robert Rubin in particular. The neoliberal consensus stressed freer markets both locally and globally. Hostility to those policies are energized by a sense that most people’s incomes are stagnant and their job security consistently eroding, and the next Congress will see some tensions within the Democratic majority. As a broad-strokes account this seems right, but Uchitelle’s article does not address one broader question. By his account, new policies embraced by some “populists” include raising the minimum wage, subsidizing college tuition, expanding the earned income tax credit, allowing the government to negotiate lower drug prices for Medicaid, increasing social security benefits, and beginning to create government-subsidized universal health care. Other new policies would stop liberalizing trade, indeed possibly reverse that process, and make it harder to lay off workers. This mix of ideas—in my opinion, some of them pretty good, some of them pretty bad—made me wonder, what do we nowadays mean by an economic populist? What do we now mean by a populist, period? The connotation of the word has changed a few times over my lifetime. When I was a small boy, “populist” still meant “good and democratic” and denoted someone taken to have been in favor of the New Deal before we had a phrase for the idea. On this theory populists fought for the little guy, and against “special interests,” which in those days meant malefactors of great wealth rather than trade unions and civil rights groups (redefining “special interests” has been one of the most remarkable achievements of the American right). When I was in high school, populists had been redefined as more complicated and morally ambiguous types, initially economic reformers on the first model who had a nasty tendency to turn into racist demagogues. After I finished graduate school, “populists” also implied people who embraced what the professional consensus thought some very bad economics. The word had also expanded its definition to denote a few rightist forms of what were in some senses anti-elite politics: elements of Thatcherism and Reaganism. I have the impression that there has been a move from the academic left to rehabilitate some of the older American populists, the ones who were idolized when I was a boy and pilloried when I was a teenager, but I wouldn’t swear to this. If there has been such a move, it may be in part the result of new research, in part the result of an erratic unease on the academic left about positioning oneself as a critic of populist movements. It is okay to criticize populist racism and homophobia, less okay to criticize populist economics, possibly because a number of left academics do not themselves repose much trust in the professional consensus of economists. “Economic populism” in its pejorative sense implies economic policies that seem to favor ordinary people but that in the long run will damage most people’s interests. By this account, economists practice a complicated discipline, one that yields some counterintuitive results, and ordinary people are likely to get economics wrong. I have some sympathy for elements of this view: I think the evidence supports the net advantages of free trade, while relatively few people seem to grasp this fact, even in countries where neoliberalism is the dominant intellectual position (in other countries—France, for example—there is evidence that even political elites fail to understand the net advantages of freer trade). Is the consensus of professional opinion a sufficient guide to policy? One problem is that economists themselves change their views of best practice. Decreased regulation of the economy was best practice in 1776 and remained so for a long time; increased regulation of the economy became best practice between the 1930s and the 1970s; decreased regulation at that point got a big boost, etc. You never know when a politician is ahead of the curve. On the question of the minimum wage, professional opinion is changing, but the plurality is still in one or another sense hostile. Another problem is that even if you subscribe to the professional consensus, where there is one, best theoretical practice may result in a lost election, and new economic policies that make life even worse. The best is sometimes the enemy of the good, and sane politicians usually make compromises with electoral reality. Yet another problem is that professional opinion is sometimes wrong. Nineteenth-century “race science” was vicious hooey, despite the fact that Harvard taught the subject, and nineteenth-century race science survived long into the twentieth century. There are comparable events in the history of economic thought. One more problem: the same policies are sometimes described as populist, sometimes not. “Soak the rich” was a populist economic slogan. A sharply progressive income tax, even if it is broadly popular, is less likely to be described as a populist measure, and while Louis Uchitelle’s article implies the opposite, using revenues derived from a progressive income tax to expand the earned income tax credit does not strike my ear as “populist economics,” at least when it is so described (Nixon proposed something similar: when he did so, was he an economic populist, or a good Keynesian?). So if the other bloggers are interested: How do you nowadays use the word populist?
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