Don’t insult the populists; instead, do better!

This is a bad moment for technocracy and those of us who love it. US progressives tend to favor one of two stories to explain 2016’s populist backlash against mainstream politics. The first is a surprising rise in the number of racists; the second is a dramatic expansion in those facing economic despair. But there is another story of 2016’s populist votes – one that has to do with distrust of experts, especially experts in government. People voted for leaders who promised to declare war on technocrats in Washington and Brussels. And the uncomfortable fact is that the experts had it coming. Consider the evidence. The de-regulation of finance ought to have been technocracy’s showpiece. Rules that were simple and restrictive were replaced by regulatory codes of great complexity. These codes were an expert’s dream: designed almost without interference from the public; fine-tuned to esoteric concepts such as “risk-weighted capital;” globally coordinated via the Basel Accords. All governed, at least in part, by independent central banks – the high temples of technocracy – their expert-led decisions insulated from political interference. And, of course, all of these elaborate regulations, international working groups, and independent regulatory institutions failed to prevent – and indeed may have been partly responsible for – the global financial crisis. And then in the aftermath, the technocrats and the politicians that they served failed to bring anyone to justice while issuing self-congratulatory memos about how a bold response by central banks had averted a second Great Depression. In the Eurozone, of course, they did not issue such memos, because there the technocracy – admittedly with some political...

Iraq Could Help Stabilize the Middle East

In the new year, hope springs eternal: while Iraq seems a looming disaster, there is at least the potential that US efforts there could help stabilize the Middle East. The key is to apply lessons learned in the reconstruction of Japan. All eyes are on Iraq’s upcoming elections as the test case for America’s plan to bring to democracy to the Middle East. But elections alone do not build stable democracies. The US is failing to learn from history – and missing an opportunity to put the stability of the Middle East on a firmer foundation. In politics, it always matters who has the money, and in the Middle East, the wrong people have it. For decades the region’s political agenda has been set by oil-rich princes, tithe-rich ayatollahs, and aid-rich generals – to the detriment of both political openness and economic development. It is not easy for outsiders to change this kind of politics, but it is possible. Consider the lessons learned in Japan. Recent books by Aaron Forsberg and Sayuri Shimizu have shown that it was not just Japanese industriousness and ingenuity that made post-war Japan such a success. It was the unusual form of US aid. In Japan, as in Iraq, the early days were dark and difficult. Japan was economically devastated, politically authoritarian, and hopelessly exotic to its American occupiers. Two years into the occupation, Japan’s economy was stagnant and inflation was rising. But then the Americans made an abrupt change of strategy. In 1948, National Security Council policy statement NSC 13/2 abandoned attempts to reform Japan’s politics and economy along US lines and made...

Mexico Falls Down

In this year’s FDI Confidence Index, published by A.T. Kearney, Mexico’s ranking plummeted from the third most attractive destination for foreign direct investment – just behind the US and China – to 22nd place. Considering Mexico’s vibrant democracy and membership in NAFTA, this is a shock. Why has Mexico fallen down? The conventional wisdom has it that Mexico and China are engaged in an epic struggle which only one can survive. And it will not be Mexico. Mexico was – with its plentiful and cheap labor – the preferred workshop for America. But Chinese labor beats Mexican labor handily on both cost and plentitude, so the American factory jobs that had headed south are now heading east. China’s rise is Mexico’s fall. There is some evidence to bear this out: over the period from 2001 to April 2004, according to A.T. Kearney, one of every four maquila manufacturing plants that had opened in Mexico – representing some 250,000 jobs in all – were shut down. And of the plants that were shut down, approximately one in three reportedly moved to China. But this explanation for Mexico’s woes makes little sense, as trade is not a zero-sum game. After all, the jobs that moved from the US to Mexico did not cause the US economy to crash. And the US, despite competition from both Mexico and China, remains one of the world’s top investment destinations. Perhaps one could claim that China ought to displace Mexico at the top of the FDI attractiveness rankings. But Mexico fell 19 places in a single year. Something more fundamental must be wrong. That something...

Forecasting the United States Election

The American Political Science Association, meeting in Chicago, assembled six of the world’s top scholars in the field of electoral studies to forecast the US presidential election. Their verdict? Bush, probably. The Panelists: Helmut Norpoth (SUNY Stony Brook) Brad Lockerbie (Univ. of Georgia) Thomas Holbrook (UW Milwaukee) Christopher Wlezien (Oxford) with Robert Erikson (Columbia) Alan Abramowitz (Emory) Michael Lewis-Beck (Univ. of Iowa) with Charles Tien (CUNY Hunter) Moderator: James Campbell (SUNY Buffalo) “This will not be a ‘girly man’ forecast,” says the moderator. And it isn’t. Helmut Norpoth towers over the podium, grips the edges with meaty hands, the microphone reaching only just above his navel. “Bush wins with 54.7 percent of the popular vote,” he thunders, in a distinct German accent. This being academia, bold forecasts, and even accurate forecasts, aren’t all that matters. Norpoth is certainly bold. He made his forecast back in January and hasn’t changed it. Bold, but is it justified? All the panelists make their predictions based on statistical models of voting behavior, back-tested on data from previous elections. But not just any data. If blue-eyed candidates always beat candidates from Texas, that won’t cut it. There must be a sound theoretical basis for each model’s explanation of why Americans vote the way they do. “The best way to predict an election is with an election,” Norpoth says, defending his approach. Most of the models include some measure of the economy – reflecting, loosely, the idea that people vote their pocketbooks. (“It’s the economy, stupid.”) Norpoth’s model is based mostly on a sophisticated reading of the New Hampshire primary results. Which is why he...

The Long Shadow of Iraq’s Future

Experts frequently point to Iraq’s past – colonial history, Saddam’s brutality, ethnic rivalries – to explain the current violence. But evidence from similar regimes indicates the causes may lie not in the echoes of the past, but in the long shadow cast by Iraq’s uncertain future. “It is hard to fight and kill other people” – so said an Iraqi insurgent, struggling to explain to The Nation’s Christian Parenti why he had hung up his guns. Not to mention, US troops have overwhelmingly superior training, technology and firepower. Against this, planting roadside bombs is one thing, but attempting to take and hold towns – as Sunni and Shia militias have done in recent weeks – is quite another. For the Americans, it is frightening. It looks like a widening rebellion. But for the Iraqis, it is suicidal, and the militiamen have perished in the hundreds. So why do it? No doubt many are motivated by religious zeal or rage at US troops. But it is no coincidence that the most violent groups have been those which expect to be excluded from power after the June 30th handover. The Sunnis in Fallujah have done the math and realize democracy will mean rule by the Shias. And rebellious Shia cleric Moqtada al-Sadr, whose militia seized Najaf, has been excluded from the political process in favor of more moderate figures. This matters because in country after country, regardless of history, culture or geography, the presence of natural resource wealth has long fostered violence by politically excluded groups. The circumstances are varied, of course. The World Bank, in a famous study, tracked 161...