Led by a class of omnipotent central bankers, experts have gained extraordinary political power. Will a populist backlash shatter their technocratic dream?
.. A quiet, balding, unassuming technocrat confronted the lions of the legislative branch, armed with nothing but his expertise in monetary plumbing.
.. Mario Draghi, president of the European Central Bank, defused panic in the eurozone in July 2012 with two magical sentences. “Within our mandate, the ECB is ready to do whatever it takes to preserve the euro,” he vowed, adding, with a twist of Clint Eastwood menace, “And believe me, it will be enough.”
.. “Superman and Federal Reserve chairman Ben Bernanke are both mild-mannered,” a financial columnist deadpanned. “They are both calm, even in the face of global disasters. They are both sometimes said to be from other planets.”
.. the cult of the central banker was only the most pronounced example of a broader cult that had taken shape over the previous quarter of a century: the cult of the expert
.. Those moments when Bernanke faced down Congress, or when Draghi succeeded where bickering politicians had failed, made it seem possible that this technocratic vision, with its apolitical ideal of government, might actually be realised.
.. No senator would have his child’s surgery performed by an amateur. So why would he not entrust experts with the economy?
.. At the Fed, by contrast, experts were gloriously empowered. They could debate the minutiae of the economy among themselves, then manoeuvre the growth rate this way or that, without deferring to anyone.
.. the ultimate embodiment of empowered gurudom was Alan Greenspan, the lugubrious figure with a meandering syntax who presided over the Federal Reserve for almost two decades. Greenspan was a technocrat’s technocrat, a walking, talking cauldron of statistics and factoids, and even though his ideological roots were in the libertarian right, his happy collaboration with Democratic experts in the Clinton administration fitted the end-of-history template perfectly.
.. Richard Nixon and his henchmen once smeared Arthur Burns, the Fed chairman, by planting a fictitious story in the press, insinuating that Burns was simultaneously demanding a huge pay rise for himself and a pay freeze for other Americans.
.. When Greenspan replaced Volcker in 1987, the same pattern continued at first. The George HW Bush administration tried everything it could to force Greenspan to cut interest rates, to the point that a White House official put it about that the unmarried, 65-year-old Fed chairman reminded him of Norman Bates, the mother-fixated loner in Hitchcock’s Psycho.
.. The Clinton adviser Dick Morris summed up economic policy in this period: “You figure out what Greenspan wants, and then you get it to him.”
.. How did Greenspan achieve this legendary status, creating the template for expert empowerment on which a generation of technocrats sought to build a new philosophy of anti-politics?
.. The bullying of central banks by Johnson and Nixon produced the disastrous inflation of the 1970s, with the result that later politicians wanted to be saved from themselves – they stopped harassing central banks, understanding that doing so damaged economic performance and therefore their own reputations.
.. To the contrary, he embraced politics, and loved the game. He understood power, and was not afraid to wield it.
.. He entered public life when he worked for Nixon’s 1968 campaign – not just as an economic adviser, but as a polling analyst.
.. In Nixon’s war room, he allied himself with the future populist presidential candidate Patrick Buchanan
.. In the mid-1970s, when Greenspan worked in the Gerald Ford administration, he once sneaked into the White House on a weekend to help rewrite a presidential speech, burying an earlier draft penned by a bureaucratic opponent. At the Republican convention in 1980, Greenspan tried to manoeuvre Ford on to Ronald Reagan’s ticket – an outlandish project to get an ex-president to serve as vice president.
.. “He has the best bedside manner I’ve ever seen,” a jealous Ford administration colleague recalled, remarking on Greenspan’s hypnotic effect on his boss. “Extraordinary. That was his favourite word.
.. Greenspan’s critics frequently complained that he was undermining the independence of the Fed by cosying up to politicians. But the critics were 180 degrees wrong: only by building political capital could Greenspan protect the Fed’s prerogatives.
.. But after a landmark 1993 budget deal and a 1995 bailout of Mexico, Clinton became a firm supporter of the Fed. Greenspan had proved that he had clout. Clinton wanted to be on the right side of him.
.. Volcker lacked Greenspan’s political skills, which is why the Reagan administration succeeded in packing his board with governors who were ready to outvote him. When Greenspan faced a similar prospect, he had the muscle to fight back: in at least one instance, he let his allies in the Senate know that they should block the president’s candidate.
.. Volcker also lacked Greenspan’s facility in dealing with the press – he refused to court public approval and sometimes pretended not to notice a journalist who had been shown into his office to interview him. Greenspan inhabited the opposite extreme: he courted journalists assiduously ..
.. It was only fitting that, halfway through his tenure, Greenspan married a journalist whose source he had once been.
.. Greenspan maximised a form of power that is invaluable to experts. Because journalists admired him, it was dangerous for politicians to pick a fight with the Fed: in any public dispute, the newspaper columnists and talking heads would take Greenspan’s side of the argument. As a result, the long tradition of Fed-bashing ceased almost completely.
.. The Brexit referendum featured Michael Gove’s infamous assertion that “the British people have had enough of experts”.
.. In the United States, Donald Trump has ripped into intellectuals of all stripes, charging Fed chair Janet Yellen with maintaining a dangerously loose monetary policy in order to help Obama’s poll ratings.
.. If the experts’ legitimacy depends on delivering results, it is hardly surprising that they are on the defensive.
.. As the advertising entrepreneur John Kearon has argued, the public has to feel you are correct; the truth has to be sold as well as told; you have to capture the high ground with a brand that is more emotionally compelling than that of your opponents.
.. To survive these inevitable resentments, elites will have to understand that they are not beyond politics – and they will have to demonstrate the skill to earn the public trust, and preserve it by deserving it.
This is the best book to help you understand the wild 2016 campaign
Yet there is strong political science evidence that football wins boost the president’s approval rating in the winning team’s media market while depressing it in the losing team’s market. The effect is short-lived, so the Bengals’ one-point win back in September won’t deliver Ohio to Clinton on Election Day, but it is true that if the Steelers and Eagles both win their November 6 games, that could meaningfully improve Clinton’s chances in a key swing state.
.. Back during the 2000 campaign, George W. Bush and Al Gore both blanketed swing states with ads touting the respective candidates’ positions on Social Security. Bush, riding the late ’90s wave of enthusiasm for stock market speculation, proposed allowing workers to invest a share of their payroll taxes in private accounts. Gore, counting on Social Security’s traditional popularity, characterized this as a risky scheme that would call Americans’ retirement security into question.
.. A folk theory account of Bush, Gore, and Social Security would say that voters who found Bush’s Social Security message persuasive gravitated toward him but those who liked Gore’s plan gravitated toward him. This is a view in which people’s policy beliefs come first and their political allegiances follow naturally.But it turns out that this isn’t really what happened. Gabriel Lenz did a more sophisticated study of voter dynamics and found that it’s actually the opposite. Rather than voters changing their minds about the candidates in response to information about their Social Security plans, voters changed their minds about Social Security.
A Bush voter who started the campaign leery of privatizing Social Security, in other words, was much more likely to respond to the dueling ad campaigns by deciding he liked privatization than to respond by deciding that he liked Al Gore. Attachments to political parties and particular leaders are simply more profound and more deeply held than attachments to issue positions.
.. Most of us know, on a gut level, that this rationalization process happens.
Back in 2008, Republicans were inclined to emphasize the risk of electing an inexperienced commander in chief, while eight years later Democrats are bragging about having the most qualified nominee ever. Simply put, for most people, attachments to parties and candidates are more profound and more fundamental than attachments to issue positions.
.. Indeed, Bartels and Achen show that in some ways, highly attuned voters are simply better at misinforming themselves. Back in the 1990s, for example, the budget deficit was falling rapidly, and Bill Clinton liked to tout this fact. Under the circumstances, it’s perhaps not so surprising that Democrats were more likely than Republicans to correctly state that the deficit was declining.
What is surprising is that, as Bartels and Achen showed in a classic 2006 paper, it’s not the uninformed Republicans who are more likely to have gotten this wrong. Instead, the more attention a given Republican paid to politics and political news, the more likely he was to mistakenly believe the deficit was rising during the Clinton years. Paying more attention to politics, in other words, didn’t make people more informed about the underlying issue — it made them more informed about partisan talking points.
.. The fact that citizens are getting their views on issues from the politicians they support and not vice versa — and that the most informed citizens are most likely to do so — is simply devastating to the folk theory. Voters cannot be selecting leaders whose stances they agree with if it turns out that voters are learning what stances they should agree with by taking cues from the leaders they support.
.. So what happened? Folk theory would predict the existence of some Wilson administration policy initiative that negatively impacted New Jersey beach communities. The truth is that a calamity did strike — a wave of unusual shark attacks against human swimmers.
.. Wilson was not, obviously, capable of controlling sharks’ migratory patterns or appetite for human flesh. Nor does it seem especially likely that Jersey Shore residents suddenly became confused about this fact. It’s just that the shark attacks were bad, they led to bad secondary effects, and those effects were especially salient in beach towns. People felt grumpy and panicked, so they voted against the incumbent.
- Voters appear completely blind to comparative issues. Incumbent governments all around the world were punished for the Great Recession with no consideration of whether their country did better or worse than the average country in navigating a global catastrophe.
.. Vox’s Trump Tax model, designed in partnership with a group of political scientists, suggests that Trump is polling about 5 percentage points worse than you would expect a generic Republican to poll given the overall political climate. Major election forecasts see a Trump win as unlikely, but still normally give him a 1 in 4 or 1 in 5 chance, meaning a Trump win would be the equivalent of a football team blowing an easy field goal — surprising, but hardly unheard of.
.. Most successful democracies have parliamentary governments — often backed by proportional electoral systems — leading to a politics that reenforces this tendency and avoids tipping points. In the American system, small shifts in public sentiment can lead to drastic changes — either Bush or Gore, either Clinton or Trump — whereas the Dutch or German electoral systems ensure that a small change in voting behavior leads to a small change in the composition of parliament. Any given party could put a fool or a knave forward as leader, and he might still win votes. But to exercise meaningful power he would need to negotiate with other coalition partners, which is hard to do if you’re a fool.
The American system has no such safeguard. If a fool or a knave secures the nomination of one of the major political parties, he has a pretty good chance of becoming president, at which point all bets are off.
When the office was originally designed by the framers of the Constitution, they meant for it to be an indirectly elected office whose holder would be selected by a collaborative meeting of Electoral College members, thus insulating it from popular whims.
E pluribus unum
Many of us understand and agree that the way you lose to terrorism is to cop to its premises in the way that you react to it. If ISIS or Al Qaeda want to claim that there is a war of civilizations, a religious war between “Muslims” and “The West”, the worst thing we could do is to live up to the role into which the terrorists have cast us by indiscriminately harassing and attacking Muslims. Acts of ostentatious violence are calculated to goad us into reinforcing the enemy’s framing of the conflict.
.. I think that the “war on terror” cannot be won by defeating ISIS or Al Qaeda or any other enemy, but will end when the people of the Middle East have hope of living decent lives in stable countries with legitimate governments. Most problems in the world must be solved, not defeated, however attractive the branding of yet another “war on” may be.
.. But you can’t solve “Trumpism” by defeating racism.
A parliament without a parliamentarian
Like a parliament, a blockchain is a means by which a group of people collaborates to produce an ordered list of accepted “resolutions” that is deemed authoritative and legitimate by some community it represents. That list of resolutions may cause the construction of alteration of some side-product. Laws passed by Congress create or alter the United States’ legal code. “Blocks” accepted by Bitcoin “miners” change account balances in an implicit ledger of who owns what Bitcoins. But the authoritative source is always an ordered list of accepted resolutions, from which the state of the side products may mechanically be derived.
.. Most obviously, the leadership of a deliberative assembly may be capable of preventing consideration of resolutions that the membership would pass if required to vote on the question. Anyone who follows real-world politics understands that it matters very much who “controls” a legislative house.
.. Among blockchain enthusiasts, preventing the consideration of a potentially acceptable resolution is usually referred to as a “censorship attack”.
.. Every few minutes, or even seconds, the winner of a new lottery is announced. The winner gets to submit resolutions for consideration by the parliament, and is financially rewarded if her “block” of resolutions is accepted by the majority. The proposal of resolutions is not restricted to miners. They may be submitted by, well, anyone at all. Miners check the resolutions and decide if they are likely to pass. They combine the ones that do seem likely to pass into a “block”, and hope to win the lottery. A miner may try to exclude resolutions that are likely to pass but that she herself disagrees with, but that sort of censorship is unlikely to have any effect, since she is unlikely to win the lottery in any particular round.
.. Blockchains reward consensus: It is lucrative to go along with most others would go along with. Understanding the will of the majority of their colleagues and bending to it is the job of each and every legislator.
.. If more than half of the participants in the Bitcoin blockchain suddenly decided that User A was evil and should not, in fact, be permitted to spend her money, then lottery-winners would quickly learn to exclude her resolutions, and that would become a new, communally enforced norm. People in the Bitcoin community who consider a norm like this illegitimate would refer to it as “censorship” or a “51% attack”. But “51% attack” is just another way of describing “majority rules” when you don’t like the decision of the majority.
.. Ones weight in the parliament is determined by how much computing power one can bring to bear, and, it turns out, sometimes by the form of the computing power, as Bitcoin for example is best run by very specialized chips.
.. A blockchain, like a parliament, is much more a social institution than a technological one, although very clever technology was necessary to design blockchain systems that could become socially credible.