Why is Trump so popular?

Ok maybe his star is waning. Maybe he has crossed one norm that alienates him from the majority in the United States, commitment to the democratic process. However it cannot be denied that, for a bombastic, demagogue who has cornered the market on phobes, (Zeno, Homo, Islama etc.) and has all the charm of a lounge iguana, Trump has tapped into a genuine and substantial vein of discontent.

The 2016 election may well come to be seen as a portent of things to come. Two years ago the idea that an avowed socialist would give Mrs Clinton such a run for her money in the Democratic primaries would have been laughed at. Similarly, who thought Donald Trump could become the Republican nominee, and what is more, run Mrs Clinton a tight race despite a whole number of increasingly outrageous comments.

I suspect after the race if Trump loses there will be analysis to demonstrate that he was never going to win given the basic demographics of the States. Even if this is true there is no denying his popularity amongst a large swath of the American public. More, his radical agenda might have got even more traction, including amongst traditional Democratic supporters, if he were not such a bafoon.

Mrs Clinton made the mistake of consigning half Trumps supporters to the “basket of deplorables”. This was not just a tactical, PR mistake it was a theoretical error. Whilst I have every confidence some of his followers are thoroughly objectionable people, his popularity goes well beyond that small substratum of society. There is genuine depth to his support, a depth which has been generated by tectonic shifts in America’s political economy that have been happening over decades, perhaps half a century. Each year, a small, almost imperceptible, but definitely detrimental, change in the position of the American Middle Class, and specifically, blue-collar workers.

It is a process which Ryan Avent claims began sometime in the 1970’s and is not about the periodic cycle of economic boom and bust. It is a secular decline in the relative position of labour in the distribution of income and wealth. The post war era was a boom time for the vast bulk of the American population. Between 1947 and 1972 real wages in the US rose by between 2.5% and 3% per annum.

From the 1970’s however, the rate of increase of real pay declined to an average of less than 1%. Up to the 1970’s workers pay rose broadly in line with the increase in productivity. From the 1970’s onwards however productivity growth slowed. Pay however, faired even less well, between 2005 and 2014 productivity increased by about 1.4% per annum, about twice the rate of real pay increases.

Avent goes onto make the point that even the poor performance of mean average real wages does not capture the reality for many Americans. “Median wage growth, or growth in wages for the American in the middle of the distribution, did far worse. Indeed, since 2000 the real wage for the typical American has not risen at all. Looking further back does not much improve the picture either; since 1980 the median real wage is up by only about 4%. Not per year, but over the whole period. And if you then focus in just on the real wage of the median male worker, the duration of the stagnation extends back into the 1960’s”. (1)

The picture painted by Avent of stagnating incomes for the majority of the population has been well documented in a range of book over the past few years. Robert Stiglitz(2) , Hacker and Pierson(3) and, of course, Thomas Picketty(4) have screen-shot-2016-10-23-at-14-58-44all pointed to this phenomenon and its role in increasing the levels of inequality in America. Typical is the “U” shaped graph showing Income inequality in the United States 1910 – 2010 in Thomas Picketty’s book Capital in the 21st Century. This charts the high levels of inequality in the first 40 years of the 20th Century followed by the dramatic reduction in inequality from the period after the second world war, then an accelerating growth in inequality since the 1970’s to levels not seen since the late 1920’s.

Given this gradual but enormous change in the position of middle class America it should be no surprise that people are frustrated and angry. The frustration arises out of the narrative that says this process is an inevitable result of progress. Opposing it is a luddite response to the course of history and in due course a whole load of new jobs will come along to take up the slack. The problem is the new jobs that have come so far are low skilled, low paid and very precarious.

At the same time people can see corporate and financial leaders taking enormous salaries, many multiples those of their predecessors at a time when GDP growth is lower than it used to be. Worse the people that take these enormous salaries seem to be able to secure them through location rather than performance. Whatever the results of the company the salaries of those in the C suite go up.

Worse yet when exceptionally highly paid people in the finance industry bring the economy to its knees, costing thousands of jobs and homes they are bailed out by the very people whose lives have been devastated, the tax payers. The people who arrange these bailouts as public officials later move on to work in the very institutions that have been saved. In these circumstances you can understand why the ordinary American is highly cynical about the ability of the existing political system to bring about change in their favour. This is why Mrs Clinton is struggling. She is perceived as too close to the traditional political machine and worse, Wall Street.

America may have averted a tragedy if they avoid the election of Donald Trump but they should not think they have avoided a crisis. It is not going to be politics as usual even if Mrs Clinton secures the White House. Radical change is needed in the States. There are a number of systemic problems that need to be addressed which would involve a real shift in the distribution of power. If Mrs Clinton can achieve this she will go down as one of the great US Presidents. If she cannot, and I am not optimistic, America, and therefore the rest of the world, are in for a very challenging time.





(1) Ryan Avent The Wealth of Humans: Work and its absence in the Twenty First Century. Penguin Random House 2016

(2) Joseph P Stiglitz The Price on Inequality Allen Lane 2012

(3) JacobS Hacker & Paul Pierson Winner Take All Politics Simon and Schuster Paperbacks 2011

(4) Thomas Piketty Capital in the 21st Century Harvard University Press 2014


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