Against the Politics of Pessimism

Optimism is a hard sell these days. This is too bad, because the dominance of pessimism is, in and of itself, a barrier to progressive politics. I know that most pessimists don't feel that way. They say they're just being realistic! But in my view this alleged realism is a self-fulfilling prophecy and a wee-bit self-indulgent. European economist Phillippe Legrain, writing on the Project Syndicate site, makes this case cogently and in the process provides an interesting typology of pessimism.

"A big reason why Western politics is in such disarray is voters’ pessimism about the future. According to the Pew Research Center, 60% of Westerners believe today’s children will be “worse off financially than their parents,” while most Europeans think the next generation will have a worse life. To paraphrase the philosopher Thomas Hobbes, they expect youngsters’ lives to be solitary, poor, nasty, brutish – and long.

Pessimism afflicts those who have lost out economically, as well as those who worry that they (or their communities) may be next. It affects young people anxious about their prospects and older people nostalgic for their youth. And it encompasses both economic fears that robots, Chinese workers, and immigrants are threatening people’s livelihoods, and cultural fears that white Westerners are losing their privileged status both locally and globally.

When people doubt that progress is possible, they tend to fear change of any kind. Rather than focusing on opportunities, they see threats everywhere and hold on tighter to what they have. Distributional cleavages come to the fore – toxically so when overlaid with identity clashes. Western politics can become rosier again, but only if politicians first address the root causes of the gloom.

Today’s naysayers come in three shades. Accepting pessimists – often center-right voters who are doing fine but are worried about the future – believe that shaking up the system is impossible or undesirable, so they grudgingly accept their country’s diminished prospects. Politicians of this type seem content, in effect, to manage a relatively comfortable decline.

Anxious pessimists, often on the center left, are glummer about the future, but seem content merely to soften its hardest edges. They want to invest a bit more, and to distribute more equitably the meager proceeds of weak growth. But they are also increasingly fearful of technological change and globalization, and thus seek to limit their pace and scope. The goal of center-left politicians of this kind seems to be to make an uncomfortable decline more tolerable.

Finally, angry pessimists – often populists and their supporters – think economies are rigged, politicians corrupt, and outsiders dangerous. They have no desire to manage decline; they want to destroy the status quo. And they may pursue lose-lose outcomes simply so that others will suffer.

What these groups have in common is a dearth of viable solutions. Both accepting and anxious pessimists focus so much on the risks and difficulties of change that they ignore the pitfalls of inaction – not least the rise of populism – while angry pessimists assume that they can smash the system while maintaining its benefits. Western societies, for all their flaws, provide unrivaled prosperity, security, and freedom. Authoritarian nationalism and economic populism endanger that.

While the West’s relative decline is almost inevitable, its economic dysfunction is not. Yet pessimism can be self-fulfilling. Why undertake difficult reforms if a dark future seems preordained? As a result, accepting and anxious pessimists tend to elect governments that duck difficult decisions (witness Germany’s grand coalition), while angry pessimists make matters worse (by voting for Donald Trump’s “America First” agenda or for Brexit, for example)."

Legrain advances a number of good ideas to cure economic dysfunction though he's oddly credulous on Macron's reform agenda (see Varoufakis' comment on Macron in my previous post).

More analysis along these lines can be found in my book of course, as well as in Benjamin Friedman's The Moral Consequences of Economic Growth. Legrain's book of several years ago, European Spring, is also worth a look.

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Overcoming the Politics of Pessimism | by Philippe Legrain

Inspiring and reassuring voters is a political challenge, not a technocratic one. But it also requires ambitious policy solutions to help governments increase the economic pie faster and share it more fairly.