Tuesday, June 15

Only by Taxing the Rich Can Johnson Become More Than a Plutocratic Populist | Timothy Garton Ash

WWhat is the difference between former US President Donald Trump and current British Prime Minister Boris Johnson? Both men are skilled practitioners of plutocratic populism, but the “Trump of Britain”, as the president himself called his British ally, could prove even more successful.

Trump was a super diffuser of this Anglo-Saxon variant of populism. He promised to help the poor, but in reality he helped the rich. His actions were inseparable from the interests of his own businesses, party donors, and a broader oligarchy. It is true that the US economy did well until the Covid pandemic hit, but there was no substantial economic or social “leveling off.” And then many Americans, especially the poorest, died as a result of their culprit mishandling of the pandemic. Trump did not “deliver,” in the way that commentators generally use that verb, and yet more than 70 million Americans still voted for him in the last election.

Why? Because we use the word “delivery” too narrowly. Support for populism is both a cultural and an economic phenomenon. Trump complied culturally and, so to speak, psychologically. He gave Americans who had felt ignored and belittled the feeling that he was on their side, and even “one of them”: the millionaire blue-collar man who took on the burden of the white man. The emotional politics of identity triumphed over the rational politics of social and economic interest. He appealed to the 90% while in practice he promoted the interests of the 1%.

Trump was only denied a second term due to the unity of the one-party opposition behind Joe Biden, whose “Scranton hardship” life story and homey style also appealed to a portion of Trump’s electorate. President Biden now has four years to show that providing people with decent health care, education, social security, and job prospects will prevail over the very real emotional power of nationalist and populist narratives. It’s off to a great start. If he can get enough of his current $ 6 trillion (£ 4.2 trillion) proposals for post-Covid recovery, infrastructure and social spending through Congress, there will be echoes of Franklin D. Roosevelt’s New Deal.

Although Biden comes from a part of the Democratic Party that got too close to financial interests, he has recognized that the rich must do more to pay for this transformation. That is especially true of the super-rich, who have fared disproportionately well in four decades of financialized globalization – the share of private wealth in the hands of the richest 0.1% in the US tripled. from 7% in the late 1970s to around 20% in 2019. Hence his pioneering proposal that Capital gains they must be taxed at the same rate as income.

The British government was rumored to be contemplating a similar situation. capital gains tax increase in the last budget, but nothing happened. After its recent electoral victories, the Johnson administration faces the option of continuing with plutocratic populism or going further. The scandal surrounding Johnson’s lavish Downing Street flat makeover, the extraordinary access enjoyed by Brexit-supporting billionaire James Dyson and the now-collapsed Greensill Capital, and the row of planning permits surrounding the secretary of communities , Robert Jenrick, everyone talks about a Trump – as the intertwining of governmental, partisan and plutocratic interests.

At the same time, Johnson has given himself psychologically and culturally to a large part of England in the same way that Trump did in the United States, albeit with a better sense of humor. Brexit may have happened, but Brexit identity politics remains a powerful force.

To be fair, in stark contrast to Trump, the Johnson administration has also delivered an impressive vaccine launch, which is one of the biggest explanations for its success in last week’s local elections and a key election in the former Labor stronghold. of Hartlepool. Meanwhile, the negative economic consequences of Brexit have been brushed off the front page by the pandemic and may be rhetorically hidden behind the impact of Covid.

“Has luck?” The question Napoleon is supposed to have asked about one of his generals can be answered in Johnson’s case with “so far, yes.” While Biden’s personal skills as a great conciliator and America’s seemingly unshakeable two-party system provided a united opposition to defeat Trump, Johnson is fortunate to face an opposition divided into three parts. So far, Keir Starmer has failed to do with Labor what Biden did with Democrats: bring together left and center, college-educated young urban cosmopolitans and more traditional working-class voters.

The left liberal side of politics in England is still divided between Labor, Liberal Democrats and Greens. And then in the increasingly disunited UK, it’s also geographically divided between England, Wales, Scotland and Northern Ireland. It is true that in recent elections the incumbent Labor administration in Wales also benefited from the “vaccine rebound”; but a much greater cost to Labor is the electoral success of the SNP in Scotland, from where many Labor MPs have traditionally returned to Westminster.

At the local level, conservative politicians like Tees Valley Mayor Ben Houchen are delivering real investments in previously underserved parts of the country that voted for Brexit. In public policy, as in private life, Johnson seems quite happy to spend like there’s no tomorrow. However, at some point you have to pay the bills, both for investments in abandoned northern cities and for Lulu lytle gold wallpaper in his Downing Street flat. If you add what it takes to “level” nationally to the already huge costs to sustain the economy through the Covid emergency, plus future bills for the NHS, ambitious green targets, lifelong education, and all the other good things. They just got promised at Queen’s. speech, then it is very clear that you need more tax revenue to spend on this scale. Regressive taxes, which hit the poor more than the rich, is the opposite of “leveling.” So the question is: are you prepared to take on the plutocratic interests with which you are so closely tied to pay for it? That’s what Trump dodged, but Biden is coping.

So how about that capital gains tax increase on the next budget? Or a wealth tax, which Martin Sandbu of the Financial Times intriguingly suggests it is fairer than a capital gains tax. Or a land tax. Like Labor’s new shadow Chancellor Rachel Reeves, argued a few years ago, “The hardest way to earn money in this country is to go to work; the easiest way is to own capital, especially housing ”.

If the Conservatives do not go beyond the confidence trick of plutocratic pluralism, there is a chance that an electoral alliance of Labor, Liberal Democrats, Greens and, if Scotland does not vote for independence in an upcoming referendum, Scottish nationalists may find a solution. narrow and bidenesque path to electoral victory in 2023 or 2024. However, if conservatives go further and add economic substance to cultural appeal, then political change may be difficult to achieve before the second half of the 2020s.


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