Combat fire not with fire, but non-violent resistance

How to fight back against toxic populism? In the spirit of standing up against bullies, a natural tendency is to fight fire with fire. But is this the right response?

A few years ago, this question might have seemed to be largely of historical interest –  an exploration of, say, whether different tactics on the part of Germany’s left and center-left might have slowed the rise of the Nazi Party.  But rising political dissatisfaction and the mushrooming of an angry populism in country-after-country have given the question renewed, urgent salience. Hence this post, the third in a series which “wrestles with populism”.

In tackling difficult questions, I generally incline towards shades of gray, and uncover complexity rather than clear-cut black-and-white answers. To my surprise, that is not what happened here. I have become convinced that, when it comes to combating populists ready to tear down the guardrails of democracy, the inclination to fight fire with fire is unambiguously the wrong thing to do.  

A useful point of departure for making the case against fighting fire with fire is with  Daniel Kahnemann and Amos Tversky’s classic distinction between system 1 and system 2 modes of thinking –  thinking ‘fast’ versus thinking ‘slow’,  responding to stimuli via  fast-intuitive system 1 reactions, or pausing and engaging system 2 slow-deliberative  thinking. In a confrontation with toxic populism, the logic of both system 1 and system 2 modes of thought inclines us to fight fire with fire – but both mislead.

That system 1 misleads is hardly surprising. As per my earlier discussion of  ‘us versus them’, a pre-disposition to co-operate among ‘us’, and to demonize ‘them’  is deeply rooted in our human psyche. In his book Moral Tribes Harvard psychology professor Joshua Greene draws on two inter-related metaphors to explore  how these us/them instincts are adaptive for some problems,  but maladaptive for others.

Greene’s first metaphor is the familiar ‘tragedy of the commons’.  The ‘commons’ is a shared, common-pool resource, potentially renewable, but only with careful stewardship;  absent the evolutionary adaptation of a propensity to co-operate among ‘us’, the destruction of the commons would be (even more) commonplace.  Greene suggests that for local-level common-pool-resource challenges,  we can safely think fast, trusting our evolutionarily-primed intuitions for co-operation among ‘us’. However, for problems which require co-operation between ‘us’ and ‘them’,  our predispositions to favor ‘us’ and to demonize ‘them’ can all-too-readily set in motion a downward spiral of  polarization and conflict between ‘our’ group and ‘them’, even if the returns to inter-group co-operation are high. Greene describes this as ‘the tragedy of commonsense morality.’

So here’s a first (and perhaps obvious) conclusion:  when it comes to navigating the polarized energies unleashed by populism, deliberative (system 2) decision-making is the way to go. No surprise there.  But here’s something perhaps more surprising: While for many complex interactions, a deliberative process points  towards selecting a strategy of fighting back, when it comes to combating toxic populism the standard logic does not hold.  

Game theory provides a classic rationale for fighting back – the tit-for-tat strategy. In ‘repeated play’ games, joint gains are highest when both players co-operate – but each player can increase his returns by ‘defecting’, as long as the other continues to co-operate. As has been rigorously shown, the optimal strategy for both players is to abide by the ‘co-operation’ rule. But if one player is confronted by rule-breaking, the preferred strategy is to respond in kind (that is to fight fire with fire) –  ready to revert to co-operative behavior immediately the other player does.

Populists, however, are likely to view a cascading sequence of rule-breaking  as a feature not a bug.  As ‘tribunes of the people’, they present themselves as uniquely manifesting the peoples’ will  –  and then target democracy’s guardrails as the mechanism through which the elite establishment frustrates the achievement of what the people need. Tit-for-tat – reciprocating in kind to a breach of the guardrails –  plays into their agenda, accelerating a downward spiral of polarization, thereby aiding  and abetting  their effort to break loose of institutional restraints.  

To be sure, a credible argument can be made (though the counter-argument is equally credible…..) that an electoral contest against toxic populism is more likely to be won by mobilizing enthusiasm and votes from the left than by trying to claim the center. But even if counter-polarization might be a winning strategy electorally, in countries with a functioning constitutional order  adding fuel to the fire is all-too-likely to  weaken the institutions and norms which underpin democracy – a case of winning the electoral battle, but losing the governance war.

Institutions, as Nobel Prize winners Douglass North and Oliver Williamson have explored in depth, are:

“…humanly devised constraints which govern human interaction…..Governance is an effort to craft order, thereby to mitigate conflict and realize mutual gains.”

In turn, institutions are underpinned by norms. Harvard professors Steven Levitsky and Daniel Ziblatt explain:  

“Even well-designed constitutions cannot, by themselves, guarantee democracy. Like any set of rules, they have countless gaps and ambiguities…. If the constitution written in Philadelphia in 1787 is not what secured American democracy for so long, then what did? We believe much of the answer lies in the development of strong democratic norms….Institutions are more than just the formal rules; they encompass the shared understandings of appropriate behavior that overlay them”.

To undermine the institutions and norms which underpin co-operation is to destroy the basis of a thriving society.

If not by fighting fire with fire, how then to combat toxic populism? Both content and process matter. Content-wise, as the second earlier post in this series explored, the key  is to  embrace hope, rather than anger –   an inclusive vision  of citizenship, underpinned by societal commitment to equal dignity and opportunity.  Process-wise, the crucial challenge is to work to foster (system 2) reflection and deliberative thought, rather than (system 1) automatic, angry reaction.

Toxic populism has  at its core a narrative of demonization; norms of discourse disciplined by facts get in the way. The populist’s preference is to ‘gaslight’ by redefining all facts as fake news, locking-in confirmation bias and expanding space for  attacks of  the ‘other’ – and pushing society in the direction of Joshua Greene’s ‘tragedy of commonsense morality’. In the closing pages of his book, Greene argues that a key ingredient in the antidote to this downward spiral is to:

 “,,, focus on the facts, and make others do the same…..one can’t know whether a proposal is good or bad without knowing how it’s supposed to work and what its effects are likely to be….We should provide – and demand evidence…… And when we don’t know how things work, in theory or practice, we should emulate the wisdom of Socrates and acknowledge our ignorance…”

Greene’s is an equal opportunity admonition; it applies both to the worst kind of ethno-populism, and to the  high-minded utopian visions offered from the opposite end of the political spectrum.

Populists bring into politics a much needed dimension of moral struggle.  But even as we can learn from populists, we also need to reflect carefully as to which lessons are worth taking to heart.  Contrary to populists’ approach, moral struggle and deliberative discourse can be mutually reinforcing, rather than opposites.

Fight fire with fire?

How to fight back against toxic populism? In the spirit of standing up against bullies, a natural tendency is to fight fire with fire. But is this the right response?

A few years ago, this question might have seemed to be largely of historical interest –  an exploration of, say, whether different tactics on the part of Germany’s left and center-left might have slowed the rise of the Nazi Party.  But rising political dissatisfaction and the mushrooming of an angry populism in country-after-country have given the question renewed, urgent salience. Hence this post, the third in a series which “wrestles with populism”.

In tackling difficult questions, I generally incline towards shades of gray, and uncover complexity rather than clear-cut black-and-white answers. To my surprise, that is not what happened here. I have become convinced that, when it comes to combating populists ready to tear down the guardrails of democracy, the inclination to fight fire with fire is unambiguously the wrong thing to do.  

A useful point of departure for making the case against fighting fire with fire is with  Daniel Kahnemann and Amos Tversky’s classic distinction between system 1 and system 2 modes of thinking –  thinking ‘fast’ versus thinking ‘slow’,  responding to stimuli via  fast-intuitive system 1 reactions, or pausing and engaging system 2 slow-deliberative  thinking. In a confrontation with toxic populism, the logic of both system 1 and system 2 modes of thought inclines us to fight fire with fire – but both mislead.

That system 1 misleads is hardly surprising. As per my earlier discussion of  ‘us versus them’, a pre-disposition to co-operate among ‘us’, and to demonize ‘them’  is deeply rooted in our human psyche. In his book Moral Tribes,  Harvard psychology professor Joshua Greene draws on two inter-related metaphors to explore  how these us/them instincts are adaptive for some problems,  but maladaptive for others.

Greene’s first metaphor is the familiar ‘tragedy of the commons’.  The ‘commons’ is a shared, common-pool resource, potentially renewable, but only with careful stewardship;  absent the evolutionary adaptation of a propensity to co-operate among ‘us’, the destruction of the commons would be (even more) commonplace.  Greene suggests that for local-level common-pool-resource challenges,  we can safely think fast, trusting our evolutionarily-primed intuitions for co-operation among ‘us’. However, for problems which require co-operation between ‘us’ and ‘them’,  our predispositions to favor ‘us’ and to demonize ‘them’ can all-too-readily set in motion a downward spiral of  polarization and conflict between ‘our’ group and ‘them’, even if the returns to inter-group co-operation are high. Greene describes this as ‘the tragedy of commonsense morality.’

So here’s a first (and perhaps obvious) conclusion:  when it comes to navigating the polarized energies unleashed by populism, deliberative (system 2) decision-making is the way to go. No surprise there.  But here’s something perhaps more surprising: While for many complex interactions, a deliberative process points  towards selecting a strategy of fighting back, when it comes to combating toxic populism the standard logic does not hold.  

Game theory provides a classic rationale for fighting back – the tit-for-tat strategy. In ‘repeated play’ games, joint gains are highest when both players co-operate – but each player can increase his returns by ‘defecting’, as long as the other continues to co-operate. As has been rigorously shown, the optimal strategy for both players is to abide by the ‘co-operation’ rule. But if one player is confronted by rule-breaking, the preferred strategy is to respond in kind (that is to fight fire with fire) –  ready to revert to co-operative behavior immediately the other player does.

Populists, however, are likely to view a cascading sequence of rule-breaking  as a feature not a bug.  As ‘tribunes of the people’, they present themselves as uniquely manifesting the peoples’ will  –  and then target democracy’s guardrails as the mechanism through which the elite establishment frustrates the achievement of what the people need. Tit-for-tat – reciprocating in kind to a breach of the guardrails –  plays into their agenda, accelerating a downward spiral of polarization, thereby aiding  and abetting  their effort to break loose of institutional restraints.  

To be sure, a credible argument can be made (though the counter-argument is equally credible…..) that an electoral contest against toxic populism is more likely to be won by mobilizing enthusiasm and votes from the left than by trying to claim the center. But even if counter-polarization might be a winning strategy electorally, in countries with a functioning constitutional order  adding fuel to the fire is all-too-likely to  weaken the institutions and norms which underpin democracy – a case of winning the electoral battle, but losing the governance war.

Institutions, as Nobel Prize winners Douglass North and Oliver Williamson have explored in depth, are:

“…humanly devised constraints which govern human interaction…..Governance is an effort to craft order, thereby to mitigate conflict and realize mutual gains.”

In turn, institutions are underpinned by norms. Harvard professors Steven Levitsky and Daniel Ziblatt explain:  

“Even well-designed constitutions cannot, by themselves, guarantee democracy. Like any set of rules, they have countless gaps and ambiguities…. If the constitution written in Philadelphia in 1787 is not what secured American democracy for so long, then what did? We believe much of the answer lies in the development of strong democratic norms….Institutions are more than just the formal rules; they encompass the shared understandings of appropriate behavior that overlay them”.

To undermine the institutions and norms which underpin co-operation is to destroy the basis of a thriving society.

If not by fighting fire with fire, how then to combat toxic populism? Both content and process matter. Content-wise, as the second earlier post in this series explored, the key  is to  embrace hope, rather than anger –   an inclusive vision  of citizenship, underpinned by societal commitment to equal dignity and opportunity.  Process-wise, the crucial challenge is to work to foster (system 2) reflection and deliberative thought, rather than (system 1) automatic, angry reaction.

Toxic populism has  at its core a narrative of demonization; norms of discourse disciplined by facts get in the way. The populist’s preference is to ‘gaslight’ by redefining all facts as fake news, locking-in confirmation bias and expanding space for  attacks of  the ‘other’ – and pushing society in the direction of Joshua Greene’s ‘tragedy of commonsense morality’. In the closing pages of his book, Greene argues that a key ingredient in the antidote to this downward spiral is to:

 “,,, focus on the facts, and make others do the same…..one can’t know whether a proposal is good or bad without knowing how it’s supposed to work and what its effects are likely to be….We should provide – and demand evidence…… And when we don’t know how things work, in theory or practice, we should emulate the wisdom of Socrates and acknowledge our ignorance…”

Greene’s is an equal opportunity admonition; it applies both to the worst kind of ethno-populism, and to the  high-minded utopian visions offered from the opposite end of the political spectrum.

Populists bring into politics a much needed dimension of moral struggle.  But even as we can learn from populists, we also need to reflect carefully as to which lessons are worth taking to heart.  Contrary to populists’ approach, moral struggle and deliberative discourse can be mutually reinforcing, rather than opposites.

Learning from populism's four moral struggles

While I’ve not become a born-again populist, a sea change in the tenor of political discourse has led me to explore some uncomfortable terrain: What might be usefully be learned for the task of democratic renewal from the resurgence of populism in country after country?

I have come to understand that the health of societies and polities depends on  modes of discourse which raise the stakes beyond what a narrowly pragmatic way of engaging with the world can offer. As Harvard economist Dani Rodrik put it:

Any model of political economy in which organized interests do not figure prominently is likely to remain vacuous and incomplete….. But a mapping from interests to outcomes, depends on many unstated assumptions about the ideas of political agents”.

The way populists use ideas is far more potent as a call to political action than  a narrowly pragmatic pre-occupation with material interests. Populists frame politics as:

 the people in a moral struggle against elites” .

Moral, emotionally-charged language fits uncomfortably with the (seemingly) reasoned discourse with which many of us are most comfortable. However, as Berkeley professor George Lakoff  has emphasized, “political thought begins with moral premises”. Rather than recoil,  the challenge for non-populists is to engage in ‘moral struggles’ in ways which can support democratic renewal, fostering hope rather than fueling rage.  

This post distills some ideas as to how this might be done, organized around  four questions suggested by the logic of populism:

  • Who are the ‘people’?
  • Against what do the people struggle?
  • For what do the people struggle?
  • How do the people struggle?

Who are the ‘people’? The notion of the ‘people’ is (as per a recent book by Columbia University’s Nadia Urbinati) a “stubborn ambiguity” at the heart of political discourse – one which populists are adept at exploiting. The ‘people’ can be characterized variously as those who enjoy legal standing (i.e. those in whose name laws are made and enforced); as the socio-historical body that lives in a specific territory (i.e. the ‘nation’); or as some subset of the broader legal or socio-historical entities. Populist leaders set themselves the task, as Urbinati puts it, of:

 “the extraction of the ‘true people’ from the empirical people… Their notion of the people corresponds to ‘the right people’: this is the only people they plan to speak for.”

Rather than separating out a sub-group (the ‘true people’) from everyone else,  a very different way of mobilizing  ‘the people’ for a moral struggle is to embrace  an inclusive vision of “we the people”, of an active citizenry.  South Africa’s ‘united democratic front‘ which mobilized against apartheid South Africa offers a powerful, recent example of a, “we the people” struggle by an inclusive, active citizenry.

‘Active’ entails more than voting in national elections; it includes engagement at local, state and national levels; in civic organizations; and, crucially, in political parties. ‘Citizen’ entails a sense of shared obligation, a willingness to play by rules shared with other fellow-citizens – and a clear, broadly accepted framework which lays out eligibility criteria and mechanisms for transitioning from non-citizen to citizen status. (yes: immigration policy….). A sense, as a synonym for active citizenship, of civic patriotism.

Against what do the people struggle? For populists, the moral struggle is against the peoples’ enemies – those who exploit the people, humiliate them, deprive them of their just patrimony. The fuel comes from anger: vanquish the enemy, and all will be well. But once an oppositional framing has been introduced, the demon of us-versus-them polarization lurks exceedingly close to the surface – and (as I explored in an earlier post in this series) the consequences of its unleashing can all-too-readily become a catastrophic downward spiral. 

Viewed from a non-populist perspective, the struggle ‘against’ need not be personalized, but could aim instead to combat entrenched asymmetries of power which undercut  equal rights and opportunities of citizens, both economically and politically.  The  World Bank’s  2017 World Development Report, Governance and the Lawlaid out some hard truths about power asymmetries and their consequences with surprising frankness. As the WDR put it:  

The unequal distribution of power—power asymmetry—can influence policy effectiveness….the negative manifestations of power asymmetries are reflected in capture, clientelism, and exclusion”.

For countries with a strong-enough institutional platform, a struggle ‘against’ could usefully focus on a revitalization of anti-monopoly policies,  and reform of the rules governing the financing of political campaigns (including limiting the role of ‘dark money’ in politics).

For what do the people struggle? For populists, the struggle ‘for’ generally is the mirror image of the struggle ‘against’ – fueled by a false promise that once the enemies of ‘the people’ are defeated,  all will be well.  By contrast, the struggle ‘for’ is central to a non-populist vision of a thriving  democracy. It is a struggle for equal opportunity and equal dignity as citizens – for a polity, economy and society within which all citizens can work to shape their own lives,  and participate peacefully in the shaping of their societies, according to their distinctive visions of freedom and justice.  It is a ‘moral struggle’, built not on resentment, but on a foundation of empathy and mutual obligation among citizens. 

Central to the non-populist struggle ‘for’ is the classic tension between markets and the public sphere. Markets offer economic freedom and a platform for accelerated economic growth –  but left unchecked are likely to be accompanied by rising inequalities and power asymmetries. An active public sphere not only sustains a level playing field, it also is the locus for economic and social policy reforms aimed at strengthening inclusion and opportunity for all citizens:

  • Strengthening ladders of opportunity, via additional public investment in early childhood development; primary, secondary and tertiary education;  technical and vocational education; and on-the-job learning.
  • Support to help those left behind to navigate change, including strengthened social insurance; a minimum safety net; and active labor market policies.
  • Pro-active efforts at redistribution, including capital endowment and income support policies, and tax reforms which expand fiscal revenues and enhance the progressivity of the tax system

There is ample scope to debate the details of each of these, to broaden (or contract) the list. Whatever the details, what is needed is an openness to far-reaching innovation, responsive to 21st century challenges to inclusion and equal dignity – globalization, accelerating technological change, the rise of network industries, information (and dis-information) abundance,  and ongoing climate crises.

How do the people struggle? Both for populists and for non-populists, ends and means are inseparable. All-too-often, populist leaders present themselves as ‘tribunes of the people’, who uniquely manifest the peoples’ will  –  and then target democracy’s guardrails as the mechanism through which the elite establishment frustrates the achievement of what the people need.  Compromise with the enemy establishment becomes betrayal.  Concentration of power in the leader’s hands becomes the natural way to realize their vision.  The erosion of norms and institutions of restraint is a feature, not a bug.

For non-populists, by contrast, both  ends and means point in the direction of institutional stewardship, fostering co-operation rather than fueling conflict. This is well-captured in how two Nobel Prize winners, Douglass North and Oliver Williamson, define institutions, namely as:

“…humanly devised constraints which govern human interaction….. an effort to craft order, thereby to mitigate conflict and realize mutual gains.”

As means, institutions provide the necessary foundation for an inclusive economy and society, capable of offering  equal opportunity and the prospect of a better life for all their citizens. As ends, commitment to equal dignity is inseparable from waging a moral struggle in ways which respect guardrails of restraint on the abuse of power.  

Insofar as respect for institutions is central to the way in which non-populists struggle, it seemingly poses a dilemma –  requiring them to struggle against toxic populism with one hand tied behind their back. Might it not be better to defeat toxic populism by fighting fire with fire? Perhaps surprisingly, as the last post in this series explores, the answer is an unequivocal “no”.

Learning from populism – four moral struggles

While I’ve not become a born-again populist, a sea change in the tenor of political discourse has led me to explore some uncomfortable terrain: What might be usefully be learned for the task of democratic renewal from the resurgence of populism in country after country?

I have come to understand that the health of societies and polities depends on  modes of discourse which raise the stakes beyond what a narrowly pragmatic way of engaging with the world can offer. As Harvard economist Dani Rodrik put it:

Any model of political economy in which organized interests do not figure prominently is likely to remain vacuous and incomplete….. But a mapping from interests to outcomes, depends on many unstated assumptions about the ideas of political agents”.

The way populists use ideas is far more potent as a call to political action than  a narrowly pragmatic pre-occupation with material interests. Populists frame politics as:

 the people in a moral struggle against elites” .

Moral, emotionally-charged language fits uncomfortably with the (seemingly) reasoned discourse with which many of us are most comfortable. However, as Berkeley professor George Lakoff  has emphasized, “political thought begins with moral premises”. Rather than recoil,  the challenge for non-populists is to engage in ‘moral struggles’ in ways which can support democratic renewal, fostering hope rather than fueling rage.  

This post distills some ideas as to how this might be done, organized around  four questions suggested by the logic of populism:

  • Who are the ‘people’?
  • Against what do the people struggle?
  • For what do the people struggle?
  • How do the people struggle?

Who are the ‘people’? The notion of the ‘people’ is (as per a recent book by Columbia University’s Nadia Urbinati) a “stubborn ambiguity” at the heart of political discourse – one which populists are adept at exploiting. The ‘people’ can be characterized variously as those who enjoy legal standing (i.e. those in whose name laws are made and enforced); as the socio-historical body that lives in a specific territory (i.e. the ‘nation’); or as some subset of the broader legal or socio-historical entities. Populist leaders set themselves the task, as Urbinati puts it, of:

 “the extraction of the ‘true people’ from the empirical people… Their notion of the people corresponds to ‘the right people’: this is the only people they plan to speak for.”

Rather than separating out a sub-group (the ‘true people’) from everyone else,  a very different way of mobilizing  ‘the people’ for a moral struggle is to embrace  an inclusive vision of “we the people”, of an active citizenry.  South Africa’s ‘united democratic front‘ which mobilized against apartheid South Africa offers a powerful, recent example of a, “we the people” struggle by an inclusive, active citizenry.

‘Active’ entails more than voting in national elections; it includes engagement at local, state and national levels; in civic organizations; and, crucially, in political parties. ‘Citizen’ entails a sense of shared obligation, a willingness to play by rules shared with other fellow-citizens – and a clear, broadly accepted framework which lays out eligibility criteria and mechanisms for transitioning from non-citizen to citizen status. (yes: immigration policy….). A sense, as a synonym for active citizenship, of civic patriotism.

Against what do the people struggle? For populists, the moral struggle is against the peoples’ enemies – those who exploit the people, humiliate them, deprive them of their just patrimony. The fuel comes from anger: vanquish the enemy, and all will be well. But once an oppositional framing has been introduced, the demon of us-versus-them polarization lurks exceedingly close to the surface – and (as I explored in an earlier post in this series) the consequences of its unleashing can all-too-readily become a catastrophic downward spiral. 

Viewed from a non-populist perspective, the struggle ‘against’ need not be personalized, but could aim instead to combat entrenched asymmetries of power which undercut  equal rights and opportunities of citizens, both economically and politically.  The  World Bank’s  2017 World Development Report, Governance and the Law  laid out some hard truths about power asymmetries and their consequences with surprising frankness. As the WDR put it:  

The unequal distribution of power—power asymmetry—can influence policy effectiveness….the negative manifestations of power asymmetries are reflected in capture, clientelism, and exclusion”.

For countries with a strong-enough institutional platform, a struggle ‘against’ could usefully focus on a revitalization of anti-monopoly policies,  and reform of the rules governing the financing of political campaigns (including limiting the role of ‘dark money’ in politics).

For what do the people struggle? For populists, the struggle ‘for’ generally is the mirror image of the struggle ‘against’ – fueled by a false promise that once the enemies of ‘the people’ are defeated,  all will be well.  By contrast, the struggle ‘for’ is central to a non-populist vision of a thriving  democracy. It is a struggle for equal opportunity and equal dignity as citizens – for a polity, economy and society within which all citizens can work to shape their own lives,  and participate peacefully in the shaping of their societies, according to their distinctive visions of freedom and justice.  It is a ‘moral struggle’, built not on resentment, but on a foundation of empathy and mutual obligation among citizens. 

Central to the non-populist struggle ‘for’ is the classic tension between markets and the public sphere. Markets offer economic freedom and a platform for accelerated economic growth –  but left unchecked are likely to be accompanied by rising inequalities and power asymmetries. An active public sphere not only sustains a level playing field, it also is the locus for economic and social policy reforms aimed at strengthening inclusion and opportunity for all citizens:

  • Strengthening ladders of opportunity, via additional public investment in early childhood development; primary, secondary and tertiary education;  technical and vocational education; and on-the-job learning.
  • Support to help those left behind to navigate change, including strengthened social insurance; a minimum safety net; and active labor market policies.
  • Pro-active efforts at redistribution, including capital endowment and income support policies, and tax reforms which expand fiscal revenues and enhance the progressivity of the tax system

There is ample scope to debate the details of each of these, to broaden (or contract) the list. Whatever the details, what is needed is an openness to far-reaching innovation, responsive to 21st century challenges to inclusion and equal dignity – globalization, accelerating technological change, the rise of network industries, information (and dis-information) abundance,  and ongoing climate crises.

How do the people struggle? Both for populists and for non-populists, ends and means are inseparable. All-too-often, populist leaders present themselves as ‘tribunes of the people’, who uniquely manifest the peoples’ will  –  and then target democracy’s guardrails as the mechanism through which the elite establishment frustrates the achievement of what the people need.  Compromise with the enemy establishment becomes betrayal.  Concentration of power in the leader’s hands becomes the natural way to realize their vision.  The erosion of norms and institutions of restraint is a feature, not a bug.

For non-populists, by contrast, both  ends and means point in the direction of institutional stewardship, fostering co-operation rather than fueling conflict. This is well-captured in how two Nobel Prize winners, Douglass North and Oliver Williamson, define institutions, namely as:

“…humanly devised constraints which govern human interaction….. an effort to craft order, thereby to mitigate conflict and realize mutual gains.”

As means, institutions provide the necessary foundation for an inclusive economy and society, capable of offering  equal opportunity and the prospect of a better life for all their citizens. As ends, commitment to equal dignity is inseparable from waging a moral struggle in ways which respect guardrails of restraint on the abuse of power.  

Insofar as respect for institutions is central to the way in which non-populists struggle, it seemingly poses a dilemma –  requiring them to struggle against toxic populism with one hand tied behind their back. Might it not be better to defeat toxic populism by fighting fire with fire? Perhaps surprisingly, as the last post in this series will explore, the answer is an unequivocal “no”.

Us versus Them

Kent_State_massacreAre there some positive lessons to be learned from the current populist wave? Once I thought that gains in governance, economy and society happened incrementally and cumulatively. But recent years have witnessed a sea change in the tenor of political discourse. While my instinctive reaction has been to recoil,  a combination of curiosity and recognition that the rancid tenor of contemporary discourse pointed to a blind spot in narrowly-pragmatic ways of engaging with the world has led me to explore further.  Indeed, I’ve also been struck by the arguments of some well-known scholars (see HERE and HERE)  that anti-populist rhetoric can serve as a smokescreen for broader attacks on inclusive, progressive proposals for reform.

I’ve come away from an effort to learn from populism  with some sobering lessons about the limitations of framing  policy discourse narrowly around a search for with-the-grain options, and focusing narrowly on material interests.  But I also have become convinced that demons lurk exceedingly close to populism’s surface – so close as to undercut any effort to distinguish ‘good’ populism from  ‘bad’.   This post (the first of a series of three which “wrestle with populism”) explores the ‘us-them’ demon.

Before getting into demons, here’s one big thing that populists get right: They frame political engagement in explicitly moral terms –  as “the people in a moral struggle against elites” (to use a definition suggested by Harvard’s Jane Mansbridge and Princeton’s Stephen Macedo). A ‘moral struggle’ turns out to be key to transform a  transform a hitherto passive set of individuals into a collective “we”, organized for action. As Berkeley professor of cognitive science George Lakoff put it:

“Neoliberals’….argue from interests… The argument is: It is in our political interest to help others achieve their material interests….[But] political thought begins with moral premises….”.

The trouble, though, is that populism’s  ‘moral struggle’ does not play out in a vacuum: populists target an opponent. Does this inevitably conjure an us-versus-them demon into existence?

Political theorist Chantal Mouffe  (who together with her husband, Ernesto Laclau, has, for many decades,  been at the forefront of efforts to rehabilitate populism as a mode of political discourse) makes the case that, even with an opponent in the picture,  a downward spiral of polarization and disaster  need not be inevitable.  Indeed, she argues that politics is necessarily oppositional:

The political is from the outset concerned with collective forms of identification… Every identity is relational; the affirmation of a difference is a precondition for the existence of any identity…. Politics is about the constitution of a ‘we’ which requires as its very condition of possibility the demarcation of a ‘they’…..

“The crucial issue  is how to establish an us/them distinction in a way that is compatible with the recognition of pluralism? What is important is that conflict does not take the form of an ‘antagonism’ (struggle between enemies) but the form of an ‘agonism’ (struggle between adversaries)… An adversary is an opponent with whom one shares a common allegiance to the democratic principles of ‘liberty and equality for all’, while disagreeing about their interpretation.”

Mouffe’s framing does not, however, reckon with either the ways in which our brains are wired or with the ways in which populists can exploit this wiring.

Here’s the ‘wiring’ problem, as summarized by Stanford neuroscientist  Robert Sapolsky:

 “Our brains form us/them distinctions with stunning speed…. The core of us/them-ing is emotional and automatic…  Feelings about ‘us’ center on shared obligations, on willingness and expectation of mutuality… inflating the merits of ‘us’ concerning core values….. A consistent pattern is to view ‘them’ as threatening, angry and untrustworthy.”

The distance from ‘difference’ to demonization is uncomfortably narrow.

Populist politicians can all-too-readily exploit   our hard-wired propensity for ‘othering’. Sharun Mukand and Dani Rodrik model the mechanism (see HERE and HERE).  They distinguish between two channels of populists’ ideational politics  – a ‘worldview channel’ aimed at shaping citizens’ understanding of how the world works, and an ‘identity channel’  aimed at shaping citizens’ perceptions of who they are.  Toxic populism uses the two in tandem.

Take the example of an effort  by a subset of a society’s elite to  foster ethnic identification between itself and co-ethnic non-elites. With this ‘identity channel’ in place, populist-oriented elites can use the ‘worldview’ channel to persuade co-ethnics that non co-ethnics are the source of their difficult circumstances – with immigrants, Jews, Muslims and other vulnerable groups often featuring prominently in the purported conspiracy against the people.  Instances of this toxic combination are all-too-familiar, both in history and in the present. Here are some examples:

  • “Welfare parasites (minorities, recent immigrants, or whomever) who are undermining our economic system, and destroying your children’s future”;
  • “Globalists who are in league with foreigners to suck the lifeblood from our economy an society”;
  • “Immigrants are destroying our peoples’ moral fabric, with their alien culture”
  • “etc etc etc…..”

(Note that each of these can serve all-too-well as a mechanism for deflecting the attention of non-elites away from economic and social policies which, at some fiscal cost to elites, might support inclusion.)

At this point, another feature of our brains kicks in –  how we think politically and morally. New York University’s Jonathan Haidt summarizes, using the metaphor of the rider and the elephant:

“Intuition (the elephant) is the main cause of moral judgment; reasoning (the rider) typically follows that judgment……Reason is the servant of the intuitions……The rider is good at fabricating post hoc explanations for whatever the elephant has done, and is good at finding reasons to justify whatever the elephant wants to do next.”

The identity channel primes intuition. The worldview channel offers a confirmatory explanation. The threat of accelerating polarization looms large.

The erosion of norms and institutions which follows all-too-frequently from accelerating polarization (see HERE and HERE) –  is, for most of us, something to be avoided. As Nobel Prize winners Douglass North and Oliver Williamson have taught, humans devise institutions precisely for the purpose of setting restraints on human behavior, with the intent of mitigating conflict and realizing mutual gains. But here, again, what might seem to most of us to be undesirable is, for some populist leaders, a feature.

Guardrails of restraint – for example, a norm which anchors discourse in evidence, in a search for truth –  get in the way of narratives of demonization. Better to ‘gaslight’ by redefining all facts as fake news, thereby locking-in confirmation bias.

There also are broader reasons why self-aggrandizing populist leaders might embrace the loosening of restraints  on arbitrary action.  Charismatic, demagogic populist leaders present themselves as embodiments of the ‘people’, with the concentration of power in their hands becoming a way to realize the peoples’ will. Governance becomes inseparable from a permanent political campaign. Compromise with the enemy establishment becomes betrayal. Institutions of restraint become obstacles to acting on behalf of the people. The downward spiral accelerates.

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Two clear, stark conclusions follow:

  • First, the effort to extract positive lessons from populism is not wholly misconceived. Populism does not emerge out of nowhere. As I have explored elsewhere, it is in part a response to festering discontents for which narrowly pragmatic discourses had been inadequate. These discontents cannot be ignored; the response to them needs to be framed in ‘moral’ terms – and a moral framing introduces an oppositional element into political discourse.
  • Second, once an oppositional framing has been introduced, the demon of us-versus-them polarization lurks exceedingly close to the surface – and the consequences of its unleashing can all-too-readily become catastrophic.

How to reconcile these seemingly opposites – to engage politically via a moral struggle which addresses the underlying causes which give rise to populism, but to do so in a way which counters rather than fuels populism’s propensity for polarization? The second post in this series suggests what kind of vision and strategy might support democratic renewal; the final post explores what kind of tactics might foster hope rather than fuel rage.

Bridging the governance-sectors divide – reflections on Lant Pritchett’s new essay

apple-no-equal-orangeDevelopment practice has long been characterized by dialogues of the deaf. The divide between governance and sector specialists is one example. How this divide could be bridged is the focus of a new review essay  by Lant Pritchett, currently the research director  of the ambitious and influential Research on Improving Systems of Education (RISE) program. Pritchett’s essay takes some of my work as its point of departure; this blog  post comments and elaborates on some aspects of his analysis.

In my experience, both governance and sectoral practitioners pay a price for their failure to communicate. On the sector side, a consequence has been that many specialists  occupy themselves with a search for the one-best-intervention capable of transforming sectoral outcomes, blithely ignoring the ways in which political and governance context can overwhelm their best efforts. (The massive randomized-control-trial industry is exhibit one – though, to be sure I’m not mis-understood, it’s perhaps worth affirming that RCTs have their uses, as a niche within a broader effort.)

For governance practitioners, the problem is a different one. As a plethora of new acronyms (PDIA, DDD, WWG, TWP)  signals, there has been plenty of movement away from an uncritical embrace of ‘good governance’ as the necessary and sufficient condition for development. Indeed, ‘context matters’ has become the new conventional wisdom.  However, as as a recent UNU-WIDER working paper underscores, the gap remains large between generalities and practically-useful insights.  The governance discourse too-rarely strays from an in-group conversation among the like-minded. All-too-often, governance practitioners are pre-occupied with Big-G governance (improving checks and balances; strengthening administrative systems; anti-corruption initiatives and the like),  and with Big-P Politics (‘political settlements’ etc) –  rather than the small-g and small-p concerns of how power and institutions manifest at the level of the design and implementation of actual development policies.

Unmoored from the measurable outcomes which sectors can provide, dictums along the lines that practitioners should ‘think and work politically’ all-too-easily become too open-ended (and too weakly anchored in robust empirical research)  to provide useful guidance.  As I explored in depth in my 2014 book, Working with the Grain (WWG), engagement at the sector level can be a powerful way both of reaching out beyond the circle of the like-minded, and of anchoring the governance discourse in clear-cut development challenges.

The ‘accountability triangle’ introduced in the 2004 World Development Report, Making Services Work for Poor People, was a pioneering effort to bridge the governance-sectors divide but it introduced some new blind spots of its own. Pritchett was one of the principal architects of the 2004 WDR; in the new essay, he explicitly aims to push the frontier of governance-in-sectors thinking beyond the WDR framework. He locates the 2004 WDR within the broader evolution of thinking about governance. The WDR, he argues,  comprised an important step beyond  one-right-way ‘institutional mono-cropping’: it incorporated politics into the analysis; shifted  focus from ‘form’ to ‘function’, and “tried to bring people and communities back into their own localized and particularized development story”.  However,  it did not look inside the politics ‘black box’; as a consequence its exploration of how politics and accountability interacted was limited.

His new essay uses my  recent, co-authored book on the politics and governance of basic education in South Africa as the basis for an extended exploration of the analytical and practical potential of opening up the black box.  As he notes, while the education book “is about South Africa and basic education, in a deep sense this country and sector are being used as a prototype attempt to apply a framework created to be general and understand the big development picture.”

The education book builds its analysis around three classification schemas:

  • A ‘political settlements’ schema, which has four ideal types, according to whether the settlement was dominant vs competitive, or ‘personalized’ vs ‘rule of law’.
  • A ‘public governance schema – for which the 2×2 axes are hierarchical vs negotiated and personalized vs impersonal.
  • An inclusion/exclusion schema – whether the ‘social foundation’ for governance is broad or narrow.

The intent, as Pritchett summarizes, is to explore  which types of political and governance schemas can work well together – “to create a positive (not normative) framework for describing and analyzing what types of policies  will be adopted, given the politics, and how effectively those policies will be implemented, conditional on their adoption and, hence, likely outcomes on various dimensions of service delivery outcomes”.  Indeed, this gets to the core of is what I had in mind. Thanks, Lant!

But frameworks can take us only so far.  In the remainder of this blog, I elaborate on two themes which go beyond the framework laid out in WWG – but which have become increasingly central in recent years to my teaching and research.

The first addresses what I  have come to think of as  the ‘dirty secret’ of development scholarship and practice – a misalignment between much of what we teach and the political and institutional realities of many developing countries.  For many countries, the wave of democratization of the 1990s did not give birth to  ‘mature’ democracies with strong checks and balances’ institution but to a ‘personalized competitive’ (or, as per Levitsky and Way, a ‘competitive authoritarian’) polity. Elections, yes (though not always free and fair).  But also fragmented power centers; deal-making, including the discretionary conferral and withdrawal of rents,  rather than impersonalized rules as the basis for stability; short time horizons. In such contexts, policymaking can be haphazard, and public bureaucracies work poorly –  conventional technocratic policy prescriptions are singularly unhelpful in offering guidance as to what is to be done. Something else is needed.

In both WWG and the education book I explore an alternative approach under the rubric of ‘islands of effectiveness’ (or ‘pockets’ which some prefer as a way of signaling that the ‘islands’  often are  embedded within a larger, mostly dysfunctional bureaucracy).  The 2004’s ‘short-route’ comprises one type of ‘island/pocket’. But they also can emerge in ‘intermediate’ spaces between the long-route & the short-route – where, as per a 2013 paper with Michael Walton, there is the potential for developmentally-oriented interactions between senior or mid-level government officials and non-governmental actors. (In laying out this approach, we were influenced by Daniel Carpenter’s analysis of “bureaucratic entrepreneurship”.)

To achieve positive outcomes, these islands need to navigate both Elinor Ostrom’s collective action challenges, and the challenge (finessed by Ostrom) of power – a developmental coalition (orchestrated around a specific, problem-driven challenge)  needs to be sufficiently strong to trump its predatory counterpart.  Multi-stakeholder coalition-building is thus key to cultivating effective islands.  The paradigmatic example of how such islands might work is Bangladesh – especially notably (but not only) its garment export sector: initiated as an island with institutional and policy work-arounds; and sustained via a cross-party coalition among garment exporters, with strong representation (via both parties) in parliament.

South Africa’s Eastern Cape province and its education system (explored in depth in chapters 5 and 9 of the education book) comprises a sustained example of how ‘personalized competitive’ (provincial-level) political settlements might function, and how this cascades down into the education sector to the school level. As one possible way forward in such settings, the book explores the extent to which  school governing bodies (which are given extensive power in the institutional architecture of South Africa’s education system)  can be value adding ‘institutional substitutes’ for the system’s weaknesses.  As Pritchett puts it in his review essay:

“ While one doesn’t want to make too much of this potential for the creation of “islands of effectiveness” in a sea of weak governance, one does not want to make too little either. One alternative is the counsel of despair,’ that with existing governance (politics and public administration) nothing’ can be done. The other alternative is the ‘business as usual’ practice of pretending to do the same set of bureaucratic reforms again and again in the hopes it might turn out differently this time (which is also a definition of crazy)….One does not want to rely too much on evidence that boils down to eight [case study] schools, but I think in many ways we need the conceptual to guide next generations of the empirical.”

My second extension concerns the inherent limitations of structural, typological approaches to development thinking and practice. Until quite recently I conceived of my work as trying to better understand the incentives and constraints which shape behavior – expanding the terrain of analysis beyond my disciplinary roots in a narrowly-conceived vision of economics to incorporate the political and institutional determinants of incentives. I now feel that even this expanded terrain gives too little attention to a central driver of development – the role of human agency.

The human factor emerged powerfully in the South Africa education research. It was directly evident at the school-level, where performance was shaped by the way in which agency was exercised by school principals – and by parents and school governing bodies who had a key role in their selection and, more broadly, in helping shape the ethos of the case study schools. But it also emerged through the ‘back door’ – as I puzzled over why the learning outcomes achieved by the Western Cape education bureaucracy (which by all accounts, including our research, functioned as a tightly-managed machine) were markedly inferior to those of Kenya (by all accounts a much more loosely-managed system). The answer, it turned out was agency: while the Western Cape system was pre-occupied with process compliance, Kenya’s education system was fueled by an ethos of civic participation and commitment to supporting learning across the range of stakeholders.

In exploring the question of what would it take to move South African learning outcomes out of the cellar of dismal performance , I increasingly found myself looking beyond the structural, technocratic fixes – whether of the governance, the sector, the economic, or the engineering variety – which dominate the current discourse To be sure, if the structures and incentives are wrong, there are stark limits as to what can be achieved. But transforming these systems calls for human agency. Human agency also is key to  achieving gains within difficult, though not disastrous systems (which is a reasonable characterization of the public sector in large swathes of the world).

As a way of underscoring the centrality of agency, I concluded my public presentations of the education book with the following four suggestions for action (discussed further in the freely downloadable chapter 10 of the book):

  • Embrace the power of a transformative idea – an “all for learning” political invitation for citizens to engage.
  • Create space for learning-oriented innovators – both within the bureaucracy and among parents, communities, NGOs
  • Foster entry points for engagement – including participatory governance and support for developmental actors at the local level
  • Measure – and make the measures public, so that stakeholders can assess the extent to which learning is taking place.

As Pritchett notes, these messages  “may not be complete, exactly right, or even clear how to map into concrete actions”.  On the other hand,  “they almost certainly hold more promise of leading to practical action that accelerates progress in learning in basic education than the dangers of complacency, that ‘we’ know what to do—and hence repeating, for a longer time and with more money, exactly what has not worked.”  Indeed, not a quest for certainty, but rather a contribution to uncovering a promising new direction, captures well my aspiration for my work. So, again, thanks, Lant!

Thriving societies or downward spirals? Some lessons from earlier times

co-operation 1Hope, Keynes taught us, is the elixir of a thriving society. In these times, when hope is in short supply, we urgently need to know more: How is hope evoked? Why is it sustained for a while, and then unexpectedly lost? How can hope be renewed?  These questions were explored brilliantly by the great twentieth century development economist and scholar of Latin American development, Albert Hirschman.  Here are three of his crucial insights.

First, Hirschman conceived of development as an unbalanced process, with leads and lags. Tolerance for imbalances, he argued:

“… is like a credit that falls due at a certain date. It is extended in the expectation that eventually the disparities will narrow again. But if the expectation does not occur, there is bound to be trouble and, perhaps, disaster…… Non-realization of the expectation that my turn will soon come will at some point result in my ‘becoming furious’, that is in my turning into an enemy of the established order…… No particular outward event sets off this dramatic turnaround”.

Second, Hirschman conceived as the development process as involving two complementary tasks:

“The first of the two tasks is the unbalancing function, the entrepreneurial function, the accumulation function.  Increasing social and income inequalities are an important part of this picture…..In time, pressures will arise to correct some of these imbalances,  to improve the welfare and position of groups that have been neglected or squeezed, and at redistribution of wealth and income in general. This is the ‘equlibrating’ distributive, or reform function….”.

In an orderly universe, policymakers would alternate between the two functions, giving emphasis to the response which best fits the moment. But that is not how growth, Hirschman-style works in practice. Hence his third crucial insight:

The appearance of the reform function on the stage at the right time and with the right strength is not in any reliable fashion co-ordinated with the entrepreneurial function and its performance. In fact while the performance of both functions (in some proper sequence) may be ‘objectively’ essential for the growth process, their protagonists are more often than not determined adversaries….. When reformers enter the stage they may well be full of invective against the entrepreneurial groups, who will return the compliment….”.

As Hirschman underscores, a renewal of hope comes when societies embrace an encompassing, inclusive vision which transcends the invective between growth and reform champions that characterizes so much of contemporary discourse.

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For a more in-depth exploration of the above, here is a link to the paper I presented  in October 2018, at the Second Conference on Hirschman’s Legacy: A Bias for Hope. (The paper includes an application of the above ideas to the case of South Africa.)

Thriving societies or downward spirals? Some lessons from earlier times

co-operation 1Hope, Keynes taught us, is the elixir of a thriving society. In these times, when hope is in short supply, we urgently need to know more: How is hope evoked? Why is it sustained for a while, and then unexpectedly lost? How can hope be renewed?  These questions were explored brilliantly by the great twentieth century development economist and scholar of Latin American development, Albert Hirschman.  Here are three of his crucial insights.

First, Hirschman conceived of development as an unbalanced process, with leads and lags. Tolerance for imbalances, he argued:

“… is like a credit that falls due at a certain date. It is extended in the expectation that eventually the disparities will narrow again. But if the expectation does not occur, there is bound to be trouble and, perhaps, disaster…… Non-realization of the expectation that my turn will soon come will at some point result in my ‘becoming furious’, that is in my turning into an enemy of the established order…… No particular outward event sets off this dramatic turnaround”.

Second, Hirschman conceived as the development process as involving two complementary tasks:

“The first of the two tasks is the unbalancing function, the entrepreneurial function, the accumulation function.  Increasing social and income inequalities are an important part of this picture…..In time, pressures will arise to correct some of these imbalances,  to improve the welfare and position of groups that have been neglected or squeezed, and at redistribution of wealth and income in general. This is the ‘equlibrating’ distributive, or reform function….”.

In an orderly universe, policymakers would alternate between the two functions, giving emphasis to the response which best fits the moment. But that is not how growth, Hirschman-style works in practice. Hence his third crucial insight:

The appearance of the reform function on the stage at the right time and with the right strength is not in any reliable fashion co-ordinated with the entrepreneurial function and its performance. In fact while the performance of both functions (in some proper sequence) may be ‘objectively’ essential for the growth process, their protagonists are more often than not determined adversaries….. When reformers enter the stage they may well be full of invective against the entrepreneurial groups, who will return the compliment….”.

As Hirschman underscores, a renewal of hope comes when societies embrace an encompassing, inclusive vision which transcends the invective between growth and reform champions that characterizes so much of contemporary discourse.

*******

For a more in-depth exploration of the above, here is a link to the paper I presented  in October 2018, at the Second Conference on Hirschman’s Legacy: A Bias for Hope. (The paper includes an application of the above ideas to the case of South Africa.)

Keynes: “new hopes and fears, without warning, take charge of human conduct”

keynesTo understand what drives economy and society today, we need to look beyond those “pretty, polite techniques which try to deal with the present by abstracting from the fact that we know very little about the future”. In doing so, we can learn from the efforts of some giants of an earlier era.  John Maynard Keynes, magnum opus,  The General Theory,  was his effort to understand the drivers of the Great Depression. It is a difficult book, and rarely read today.

Keynes subsequently published a distillation of his core ideas in an (also rarely read) 1937 article in the Quarterly Journal of Economics. As he put it early in that article, “I am more attached to the comparatively simple fundamental ideas which underlie my theory than to the particular forms in which I have embodied them….”  I first read the QJE piece almost a half-century ago. It remains  one of the greatest academic articles I have ever read; it speaks directly to our times. Here are some highlights:

“We have as a rule only the vaguest idea of any but the most direct consequences of our acts. Of all human activities which are affected by this remoter pre-occupation it happens that one of the most important is economic in character, namely, Wealth. The whole object of the accumulation of Wealth is to produce results, or potential results, at a [distant] date. Thus the fact that our knowledge of the future is fluctuating vague and uncertain, renders Wealth a peculiarly unsuitable subject for the methods of the classical economic theory.

“By ‘uncertain’ knowledge, I do not mean merely to distinguish what is known for certain from what is only probable. The sense in which I am using the term is that….we simply do not know. Nevertheless, the necessity of action and for decision compels us as practical men to do our best to overlook this awkward fact….”

“[Given the above, our] theory of the future, being based on so flimsy a foundation, is subject to sudden and violent changes. The practice of calmness and immobility, of certainty and security, suddenly breaks down. New fears and hopes will, without warning, take charge of human conduct…..”

“I accuse the classical economic theory of being one of these pretty, polite techniques which tries to deal with the present by abstracting from the fact that we know very little about the future.”

“It is not surprising that the volume of [private] investment should fluctuate widely from time to time. For it depends on judgments about the future which do not rest on an adequate or secure foundation..”

“Given the psychology of the public, the level of output and employment as a whole depends on the amount of investment. I put it in this way, not because this is the only factor on which aggregate output depends, but because it is usual in a complex system to regard as the causa causans that factor which is most prone to sudden and wide fluctuation….. Of the several factors which [influence] aggregate output, it is those which determine the rate of investment which are most unreliable, since it is they which are influenced by our views of the future about which we know so little.”

Rekindling hope – the missing elixir to fix South Africa’s economy

hope imageThe world over, political and economic agendas that fail to offer hope to the “middle” of society have turned out to be recipes for downward spirals of ethno-populism. More than other middle-income countries, South Africa’s citizens remain either affluent or poor, with little in-between.  As of 2015, only a quarter of the country’s citizens enjoyed a level of living that could be described as stably “middle class” or better. Half of the population remained chronically poor, dependent on safety nets for survival. And the quarter in-between – who, in a thriving society, would be carriers of hope from the middle to the bottom of society – struggle, mostly in vain, to stay out of reach of destitution.

My recent piece, syndicated in The Conversation as per this link,  explored how this can be turned around. See below for the pre-publication version, which includes somewhat more detail on the three suggested ‘guideposts’ for turnaround.

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South Africa’s election season is underway,  but the discourse is stuck in a time warp. We need to look beyond the familiar nostrums that have held sway for much of South Africa’s first two decades of democracy.

In his February, 2019 State of the Nation speech, President Ramaphosa followed the classic fix-the-business-environment formula for job creation,  setting a target to move South Africa’s performance up from 82nd to the top 50 in the World Bank’s ease of Doing Business ratings within the next three years. The rhetoric from the opposition Democratic Alliance is similar.  The populist Economic Freedom Front’s vision for jobs seems to be to emulate Venezuela.

Indeed, South Africa urgently needs to get its economy moving again. But as two great twentieth century economists John Maynard Keynes and Albert Hirschman teach us,  economic momentum is not created by focusing on the myriad pinpricks about which business continually complains.  Rather, the way to reinvigorate the economy is to rekindle hope across society.

As Keynes explained, in his magisterial analysis of  the drivers of private investment (written in the depths of the 1930s great depression):

“Our knowledge of the future is fluctuating vague and uncertain.  Being based on so flimsy a foundation, [private investment] is subject to sudden and violent changes. New fears and hopes will, without warning, take charge of human conduct…..”

Thus:

“Most of our decisions to do something positive can only be taken as the result of animal spirits—a spontaneous urge to action rather than inaction…rather than mathematical expectations”

The great scholar of twentieth century Latin American development,  Albert Hirschman, built on Keynes’ insights  in a way which speaks directly to South Africa’s challenges.   He conceived of the development process as a cycle:

“Two principal tasks or functions  must be accomplished. The first is the unbalancing, entrepreneurial function…… Increasing social and income inequalities are an important part of this picture…..In time, pressures will arise to correct some of these imbalances…..This is the ‘equlibrating’ distributive, or reform function….”.

South Africa’s GEAR (Growth, Employment and Redistribution) strategy, adopted in 1996,  marked the start of an entrepreneurial  phase.  Growth reached  an average rate of over five percent per annum between 2004 and 2008, better than for any period since the 1960s.  Even so, as a recent study documented,  as of 2015  only a quarter of the country’s citizens enjoyed a level of living that could be described as stably ‘middle class’ or better.

Half of the population remained chronically poor,  dependent on safety nets for survival. And the quarter in-between (who, in a thriving society, would be carriers of hope from the middle to the bottom of society) struggle, mostly in vain, to stay out of reach of destitution. More than other middle-income countries, South Africa’s  citizens remain either affluent or poor, with little in-between. Against that backdrop, it hardly is surprising that  by the early 2010s South Africa saw the emergence of a vituperative political discourse characterized by assaults on “white monopoly capital” on the one hand and a preoccupation with institutional decay and state capture on the other.

Hirschman witnessed a parallel erosion of optimism in Latin America:  a military coup in Brazil in 1967; a massacre of students on the streets of Mexico City in 1971; the bloody assault on Chile’s presidential palace in 1973, which resulted in the death of elected president Salvador Allende and the coming to power of General Augusto Pinochet.   In a  1973 article, musing on this reversal, he  suggested that tolerance for inequality…

“… is like a credit that falls due at a certain date. It is extended in the expectation that eventually the disparities will narrow again. But if the expectation…. does not occur, there is bound to be trouble and, perhaps, disaster…… Nonrealization of the expectation that my turn will soon come will at some point result in my ‘becoming furious’ that is, in my turning into an enemy of the established order…No particular outward event sets off this dramatic turnaround… Rulers are not necessarily given any advance notice about [the tunnel effect’s]  decay and exhaustion…”.

The Hirschman development cycle points to the way out of the downward spiral – embrace the ‘reform function’ as the way to revitalize hope. This is more easily said than done:

While the performance of the entrepreneurial and reform functions (in some proper sequence) may be ‘objectively’ essential for the growth process, their protagonists are more often than not determined adversaries….. When reformers enter the stage they may well be full of invective against the entrepreneurial groups, who will return the compliment….”.

What might a turnaround look like in South Africa’s current conjuncture? Here are three guideposts.

  • Don’t confuse a re-embrace of the ‘entrepreneurial function’ with reform.

In early 2018,  with the recall by the ANC of President Jacob Zuma and the accession to the presidency of Cyril Ramaphosa, South Africa seemingly reversed course. Notwithstanding continuing infighting within the ANC, the country has witnessed an ongoing removal from positions of authority within government of many who had been deeply complicit in state capture and associated institutional decay.  But institutional turnaround is not enough.

The world over, political and economic agendas which fail to offer hope to the ‘middle’ of society have turned out to be recipes for downward spirals of ethno-populism. Thus:

  • Give priority to responding pro-actively to the concerns of the quarter or so of the population stranded in South Africa’s twilight zone between middle class stability and abject poverty.

Hirschman’s cycle underscores that  renewal comes  from a revitalization of hope among those who were stranded at the threshold of the earlier, unbalanced process – lured, but then disappointed, by unrealized promises.  This segment of society is both crucial politically in its own right – and can be a transmission belt of hope among the poorest half of South Africa’s population that upward mobility is possible. Thus:

  • Do what it takes to strengthen ladders of upward mobility.

To citizens stranded in the disappointed middle,  election season sounds like just another replay of empty promises.  Jobs? Better institutions?  They’ve heard it all before.  A genuine, visible – and, crucially, well-financed —  commitment from across society to invest in ladders of opportunity and inclusion would offer a tangible basis for hope, especially for young people.

As I’ve explored here  and here, the weaknesses in South Africa’s ladders of opportunity are different – and the challenges more readily addressable –  than those  usually emphasized in South Africa’s blame-centric political culture.  Visible gains in the affordability and efficacy of ladders of opportunity and inclusion have the potential to  unlock the most crucial ingredient of all –  a renewed sense of agency among South Africa’s citizens, of hope that, working together, we indeed have it in our power to build a future with a real prospect of a better life for all.