Chris Trotter Gets A Bit Carried Away, There Will Be No Revolution

Over at Bowalley Road:

Thanks to Labour’s right-wing MPs’ all-too-evident disdain for their party’s left-wing policy preferences, conditions akin to those which allowed the Republican Party’s conservative base to be mobilised against Washington’s RINOs (Republicans In Name Only) are now fast maturing in both the Labour Party and the trade unions.

The political class should be very, very afraid. Because the rise of both the Tea Party in the USA and the Labour Left in New Zealand are but harbingers of the radical and unstoppable populist revolt that will soon bring financial capitalism to its knees.

The political class in the United States and New Zealand have very little to fear. There will be no revolution, there will be no populist revolt and financial capitalism is currently the strongest it has been.

If you disagree with this, think about what has happened over the past few years – tens of millions of Americans have not been required to generate record profits, record exports, record asset prices and enormous amounts of wealth.

The biggest revelation of the global financial crisis is that far more people are surplus to requirements than previously thought. It’s not very nice, but I care about being honest instead of papering over reality.

Technological change and job polarisation means that hyper competitive global labour markets will see more and more wage convergence as immigration restrictions are lowered. There can be no populist revolt because no one is interested except people deeply invested in perpetuating the sorts of policies that enabled bad decisions to perpetuate in education and skills training.

The political class have nothing to worry about because insurgencies from the right are always destroyed. Read 20th century history – it is essentially a progressive success story championed by unreconstructed militant Calvinist Christianity without “god” but with “human rights” and “equality” as part of the Sunday mass.

Even in New Zealand, where The Most Horrible Reforms In World History Took Place Under Roger Douglas  , a non-trivial proportion of those reforms have been rolled back. The “neo-liberal” (the mark of a true ignoramus) policies of Working For Families, interest free student loans, increases in the minimum wage, stronger environmental protections than many OECD countries and a Finance Minister who recently expressed his pleasure with the progressivity of the income tax system are an indication of how right wing policies almost always end up being watered down or rolled back in various guises.

The tea party is a demographic aberration – they might “shutdown the Federal government” for a fortnight but it is absolutely impossible for them to change:

  • the views of the media
  • the views of every  college graduate save a few Christian colleges
  • the views of the public service
  •  the views of most of the financial elite
  • the views of most ordinary Americans who need social security or Medicaid

If anything, the success of the Tea Party makes the rollback of democracy more likely than any populist revolt taking place.

How is democracy rolled back?

  • delegated legislation – bureaucrats make the rules
  • decentralisation of systemically important decision making – local councils have broad powers

If you can fire the politicians but can’t fire the bureaucrats you can’t get any of your “populist revolt” done can you!

Politicians are temporary holders of power. Most of them have no idea how to wield this power correctly, and thus expend their political capital in stupid ways like the Tea Party congressmen and women have shown.

If they actually wanted to achieve their goals, they would have been better off quietly setting up a Fiscal Responsibility Board that linked Federal bureaucrat remuneration with killing sacred cows. Change would take time, but over the course of a decade, maybe some “wasteful spending” would have actually been cut.

Instead, all you have is a further depreciation of Brand America in the eyes of the world. And increasing concern in the financial markets over what happens when you have democracy. Look at how the failed city of Detroit is being managed – essentially a liquidator has been appointed – and you’ll see the future of “Tea Party” America.