29 March 2018

Who speaks for the losers?

The Economist, accurately I think, says the explanation for today's political polarisation lies not so much between those who favour free trade, immigration and cultural openness and those against, but in:
the gap between exam-passers and exam-flunkers. Qualifications grant access to a world that is protected from the downside of globalisation. You can get a job with a superstar company that has constructed moats and drawbridges to protect itself, or with a middle-class guild that provides job security, or with the state bureaucracy. Failing exams casts you down into an unpredictable world of cut-throat competition. Exam-passers combine a common ability to manage the downside of globalisation with a common outlook — call it narcissistic cosmopolitanism — that binds them together and legitimises their disdain for rival tribes. Exam-flunkers, meanwhile, are united by anger at the elitists who claim to be open as long as their jobs are protected. They are increasingly willing to bring the system crashing down. Talking about open v closed is a double error. It obscures the deeper forces dividing the world, and spares winners by playing down the legitimate concerns of losers. The trouble with open v closed, the 'Economist', 22 March
I agree, though I would add that the exam-passers add to the problems of the exam-flunkers by formulating policies that favour economic openness. Simple economics, for instance, tells us that large-scale immigration (for instance) raises the cost of housing and reduces wages for those whom the exam-passers see as 'losers'. Similarly with free trade: such openness might be good for that abstraction called 'the economy', but the benefits go mainly to the exam-passers (the insiders) and often accentuate the losses of the flunkers. The cultural negatives of such policies are more subjective, but I'd argue that they are important too. It's especially unfortunate, to my mind, that not only is the formulation of economic policy conducted almost exclusively by the exam-passers, but so too are discussion and debate about such policy and its consequences.

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