Policy Research in Macroeconomics

Explaining Brexit – Polanyian response or Delong’s Trumpist nativism?

Yesterday Brad Delong told us “I have a strong disagreement with Ann Pettifor here. The BREXIT vote is not the result of a class- and social structure-based Polanyi process.”
Ann, in a widely-read article in the online journal ‘Globablizations’ (and now also on PRIME) had argued

 “Brexit represented the collective, if (to my mind) often misguided, efforts of those ‘left behind’ in Britain to protect themselves from the predatory nature of market fundamentalism. In a Polanyian sense, it is a form of social self-protection from self-regulating markets in money, trade and labour….”

Back to Delong:

“Yes, Polanyi was correct in his grand argument that turning land, labor, and finance into commodities subject to the wreakings of a market society would inevitably disappoint a great many of those expectations and so potentially causing massive backlash against a liberal or neoliberal order.   But what we are seeing now is not that backlash….The “economically anxious” did not drive the BREXIT vote. The nativists did.”

Delong doesn’t explain what he means by “the nativists” but I assume he means those who support “the policy of protecting the interests of native inhabitants against those of immigrants” which is the primary dictionary definition. [1] 

But in fact Polanyi expressly takes into account the case for national borders – in his 1940 lecture “The Breakdown of the International System” – he is referring  to breakdown of the 19th century system in the first world war and thereafter – he has a subsection entitled “National boundaries as shock-absorbers”, and argues that 

“The need for external protection of national markets sprang from the nature of international division of labour under a market system… The more intense international cooperation was and the more close the interdependence of the various parts of the world grew, the more essential became the only effective organisational unit of an industrial society on the present level of technique:- the nation.  Modern nationalism is a protective reaction against the dangers inherent in an interdependent world.”

In a way, this is quite a shocking formulation – one would expect him to argue perhaps that more intense international “competition” would require the nation state to step in – but he poses then issue in terms  of “interdependence”.  Clearly, he is referring to the cooperation and inter-dependence of capital.  Moreoever, he argues that 

“if international division of labour is effected by competition and consequent elimination of the less efficient, then much will depend on the rate at which the change proceeds… if whole countrysides, countries or continents compete, the elimination of the less efficient may involve the ruin and destruction of whole communities.  Then the system, far from being a blessing, becomes a deadly danger and must be checked at all costs.”

So perhaps there is no ultimate contradiction between a “Polanyian” and a “nativist” reading of Brexit.

But from theory to the facts of who voted for Brexit and why.  The fist is simpler.  From ex post polling, we broadly know the following, in terms of party affiliation, age, social classification and education:

All data from  YouGov  save for those marked * which are from  Lord Ashcroft

All data from YouGov save for those marked * which are from Lord Ashcroft

As you can see, both Labour and the Liberal Democrats mobilised about two-thirds to vote “Remain”, so the “Leave” vote was largely a function of the Conservative and UKIP votes (if it comes to blame, David Cameron clearly is vastly more to blame than Jeremy Corbyn!).
But the most obvious factor to consider, looking in economic terms, is that of household income.  Here we have data for different household income tranches, and we can map these against the share of voters of each tranche, by party, in the General Election of 2015:

Therefore, if one takes the lowest income group (below £20,000 household income) the Conservative plus UKIP share in 2015 was 46%, which might cover the more obviously socially conservative and ‘nativist’ groupings.  If we assume that all UKIP votes and ¾ of Conservative voted Leave, that would come to about 38% of the cohort – meaning that about half of the Labour, Liberal Democrat and other voters in that group (24% in total) would have voted Leave (so probably over half of Labour voters even in this group would have voted Remain).

But it is evident that there was a strong correlation between low income and voting Leave.  

We also have some evidence, from Lord Ashcroft’s polling, on the attitudes of both sets of voters.  He finds that – of those who voted Remain – a net 4% felt that things would be better for their children, whilst of those who voted Leave, a net 22% thought it would be worse for their children. 

When asked whether they agreed with the statement  “With the way the economy and society are changing, there will be more threats to my standard of living in future than there will be opportunities to improve it”, or its opposite, a net 20% of Remainers agreed with this negative version – and a huge net 42% of Leavers agreed.  

Respondents were also asked about their views of globalisation and capitalism. On globalisation, over 60% expressed a positive view, with some 75% of Remainers being positive – but well over half of Leavers had a negative view of globalisation.  On capitalism, 57% saw it as a force for good – and these split almost fifty-fifty between Remainers and Leavers. (This leaves a sizeable 43% who don’t see capitalism as a force for good…)  

In conclusion, it is clear that the less well-off voted by large majorities to leave, but we should note that a large number of these are retired.  Of these poorer Leavers, it is likely that a large proportion were UKIP or Conservative supporters, with core Labour support even in the lower income groups splitting more evenly.

There is not surprisingly a strong correlation between Leave voters and socially conservative voters (Lord Ashcroft has data on Referendum voters’ views towards feminism, the green movement, immigration etc.).  But to my mind, the correlation with pessimism about the future, “there will be more threats to my standard of living in future than there will be opportunities to improve it”, stands out.

We need to recall that Polanyi’s counter-movement against market fundamentalism was not for the forces of sweetness and light to win against those of neoliberalism.  On the contrary, as Polanyi says in that same 1940 lecture, a state of paralysis pf both the economic and political structures becomes possible:

“This was the critical state of affairs out of which the fascist revolutions sprang. The alternative was between an integration of society through political power on a democratic basis, or, if democracy proved too weak, integration on an authoritarian basis in a totalitarian society, at the price of the sacrifice of society.”

In which case, there might be worse to come, in some of our lands, even than a victory of Brad Delong’s nightmare of “indigenous domestic Trumpists”.

Postscript added 3 November 2016:

I should also have said in the article that from the evidence – as well as from listening to the advocates for “Leave” – not all Leavers fit into the Polanyian category.  There are also the neoliberal Leavers who (against the obvious evidence) consider our membership of the EU is more of a barrier to the utopian (but imposed) market economy they dream of than “independence” will provide.  

Since 39% of ABs, and 35% of households with income above £60,000, voted Leave, one may assume that a fair proportion of these fall into the ‘neoliberal Leaver’ category.  It is indeed the clash of values between the more Polanyian/’nativist’ camp, and the neoliberal camp, which is at the heart of the May government’s negotiating conundrum.  Both camps are at root authoritarian and reactionary in political tendency, but in different ways.

[The article was also slightly edited on 3 November]


[1] The term nativism also applies to Noam Chomsky’s theory that “humans are pre-programmed with the innate ability to develop language”, but I have a feeling this was not the meaning intended by Brad Delong, and might take us down a few strange tracks in the context of Brexit!

One Response

  1. However, we also know that there was a high degree of correlation between those who voted "Leave", and who alo hold "bigoted" views on a wide range of issues from homophobia, to hostility to "feminism", to hostility to "environmentalism".

    Its hard to understand why holding all of these other reactionary views can also be explained simply in terms of a feeling of being left behind – at least in an economic sense. Of course, it can be an expression of being "left behind" in the way all people who hold reactionary views are left behind by society, that is an inability or unwillingness to realise that society and the world has moved on.

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