There isn’t just one cause for populism, there’s a whole Google of them

By Dani Sandu | Florence

One of the more intense and inconclusive debates of recent years has focused on the underlying causes for the rise in anti-establishment political figures, particularly in Central and Eastern Europe, but more recently in much more
economically advanced societies as well. While these debates have featured both academics and policy practitioners, the results have been far from conclusive, and at times even contradictory.

The first part of this essay will outline the existing debate regarding the causes of this development, while the second will delve more deeply into a specific cause: technological change. While the latter has long been argued to be a game-changer in the global economy, its more contemporary effects, especially on issues of political representation, have barely been addressed.

What is populism?

First, a definition of the new anti-establishment political parties and leaders, often called populist, is in order. Often, especially in earlier times but even more so recently, the term ‘populism’ has been readily used as a substitute for the concept of “right- wing extremism”. However, the label itself is of limited use, as any overview easily shows that the political parties under discussion freely combine left- and right-wing ideological stances, political tropes or policy proposals. In fact, Dani Rodrik ties populism to globalisation, and argues that these anti-establishment political parties are generally the result of a backlash against the prevailing globalisation discourse their supporters have been exposed to, and sometimes against the political legacy of the country in question (Rodrik 2017). Therefore, as he sees it, populism in Latin America tends to be left-wing, clearly differentiated from the military dictatorships of the ‘80s and ‘90s, and with a cool reticence toward the United States2 . On the other hand, European populism – especially as seen in Central and Eastern Europe –tends to be pro-American, anti- Communist and very much open to free market liberalisation.

Regardless, the various flavours of populism that we can find throughout the world seem to be linked by three factors:
1. a public discourse that divides society in two homogenous and antagonistic groups, ‘the ‘pure/average people’’ and ‘the ‘corrupt elites’’, placing itself on the side of the people;
2. a deeply held belief and moralisation of how politics should be the expression of the general will of the people, hence the prevalent use of referenda;
3. a relatively constant stream of nativist and (at least partially) anti-globalist political stances (Mudde 2007).

More recently, especially for EU member countries, these traits have also merged into
an obsession with sovereignty in connection to Brussels or other instances of intergovernmental decision-making. In discourse, these become the ultimate ‘corrupt’ elites, who take decisions against the will of the people and for their own benefit. In this framework, the idea of the ‘ultra- elites’ self-interest can easily appeal to anti- Semitic tendencies or beliefs.

Causes for the advent of populism

Secondly, we need to distinguish between the multiple categories of causes for the rise of such political parties. The initial distinction should be drawn between supply-side causes, related to the supply of political parties and figures available, and demand-side causes, related to the political demands of the populations in these countries. While some authors have argued that populism would not exist in the absence of populist political leaders, supply- side arguments tend to be relatively limited in scope. Political leaders have always aspired to acquire political power and consolidate their hold over it with time, but often found themselves politically isolated regionally or globally and, ultimately, they lost the public support that initially got them into office. If such attempts have always existed, many believe there is a reason why these attempts have been more widely successful today than in the past. We have little reason to believe that Orbán, Kaczyński or even Donald Trump are innately more astute or politically savvy than past political leaders.

While the unique talents of these political figures are necessarily important, their success seems to also be closely tied to the openness of the voters in their societies to believe their narratives and support their tight grasp of political power, even when they personalise and take over key democratic institutions. At times, their public support even stems from their promise of such take-overs. While middle-class voters were generally considered to be the most reliable voters of establishment/centrist parties, recent years have seen them defecting in droves (JW Müller 2016; Levitsky and Ziblatt 2018). Middle-class voters still generally tend to prefer establishment political parties, but the change in their electoral preferences is gradually forcing these movements to spiral away from the centre in search of public support. Recent political research is more closely examining the changing nature of modern societies and the individual- level beliefs of the citizens which motivate their political choices.

Demand-side explanations

Discussions about population-level causes for the rise of new anti-establishment political forces circle around cultural and economic factors (Inglehart and Norris 2016). In this context, cultural issues are understood as individual cultural beliefs that motivate voters to favour populist parties. Such beliefs span from relative opposition to migration or acceptance of refugees/immigrants, beliefs about the nature of families, gender roles, even beliefs about child-rearing, to more abstract beliefs regarding ideology or reflections on particular moments
of a society’s history, especially opposition to the idea of Communism and post- or quasi- Communist institutional arrangements or styles of leadership. Overall, though, cultural motivations for the surge in populist parties
are seen in large part as a reaction against progressive cultural change. This view is built upon the “silent revolution” theory of value change. This posits that economic advancement has moved younger generations in the direction of post-material values such as cosmopolitanism and multiculturalism, environmental protection, human rights or gender equality. While this shift has been heavily documented in the past, more recent research has found evidence of a backlash against this movement, especially by white men of older generations, who see themselves as having lost out in relative terms because of the advent of these cultural changes.

On the other hand, the economic reasons are thought to stem mostly from growing economic inequality, which was accelerated by the recent financial crisis but is in fact part of a much longer trend. Many recent studies have pointed to the quasi-paradoxical fact that while global inequality seems to have greatly decreased in recent years, in-country inequality seems to be increasing at an unprecedented rate (Milanovic 2018). While the income of the average Pole is closer to that of the average Austrian than ever in the last 50 years, the incomes of the richest Poles, Austrians, British or Romanians are also farthest from those of their poorest countrymen than ever in the last 50 years. This inescapable dynamic has generated much resentment and grief, especially at the national level of politics.

People who feel left behind economically therefore start to resent the political establishment – national and international – that has supervised these trends and are ‘thus perceived as ‘responsible’’ for it. As a result, the populations who feel forgotten become more susceptible to revolutionary political proposals, especially any which are clearly anti- establishment. By promising to dismantle the economic consensus that has generated their economic vulnerability, populist political parties are seen as offering a solution – not necessarily because their promises are thought to bring prosperity, but because their actions are thought to level the playing field and potentially sanction those who have been benefiting for too long from globalisation.

While this essay cannot even begin to outline the debate concerning these types of causes, I will take advantage of the opportunity to note that the distinction between cultural and economic reasons for vulnerability to populism is somewhat artificial. There is absolutely no reason why cultural and economic explanations cannot interact and occur at the same time or even reinforce each other, with a helpful prod from astute politicians and supply-side explanations. The expansion of global free trade is inevitable, and most explanations include it among the causes for the rise of populism (Subramanian and Kessler 2013; Rodrik 2017). Similarly, the war in Syria and the subsequent refugee crisis in Europe – with refugees arriving from both Africa and the Middle East –are also included among the explanations (Mudde 2017).

The two exist independently of one another, and their effects on the sentiments of voters in Hungary, Poland, Romania or other countries cannot and should not be disentangled. Instead, they should be studied as an interaction of factors.

In the last part of this essay, I would like to address one cause of the current trend toward populism that fully illustrates the elusive interaction between economic and cultural factors. Many authors have spoken about the social risks brought about by technological change, but very rarely have these changes been directly linked with the growth of populism other than from the perspective of international political economy. In the following, I will try to briefly outline the mechanism of this influence, and the particularities of how this mechanism operates in Central and Eastern European countries.

How is technology enabling populism, especially in CEE countries?

Discussions about the labour-displacement potential of technological automation have been heard since the Luddite movement. These discussions have more recently started to take on an empirical turn (Autor, Levy, and Murnane 2003). In this and subsequent articles, David Autor explores how technological change mostly tends to affect labour that is repetitive, both cognitive and manual4 . As most such repetitive labour – and our instinctual understanding of repetitive labour in general – tends to be placed at the lower rungs of the income distribution, the most common reading of literature around technological automation has been that it increases inequality by rendering lower-paid workers obsolete. The truth is that the distinction between repetitive and non-repetitive labour is somewhat independent of income. Repetitive work may include that of a factory worker, normally seen as blue-collar, low-income employment, but it may also include the middle-class category, such as the labour of a white-collar law clerk or office worker, or even the work of an artist.

In this context, what technological change does is exploit the added value of automation, therefore focusing mostly on higher-income/ cognitive-repetitive labour, i.e. that of more highly paid workers. Companies benefit more in savings from automating higher-paid labour, so they focus automating these categories of work. In time, this leads to a hollowing out of the middle-class – and of mid-level paying employment – through automation and substantial pressure on lower-level incomes to stay at a low-level, or even decrease (Autor and Dorn 2013). This leads to what is called the polarisation of the labour market between cognitive higher-level paid employment, which compensated for higher levels of education; and manual lower-level employment, where incomes are pressured to stay low because of a lack of other opportunities. Those in the middle have to either invest in acquiring skills that upgrade them to non-repetitive high-skill labour, downgrade to lower-skill non-repetitive or repetitive labour, or be left without employment (Acemoglu and Autor 2011; Oesch 2013). More simply put, the downwards move of mid-level employment leads to the polarisation of the labour market, while the move of mid-level employment upward leads to upgrading.

Obviously, these changes are likely to generate serious economic consequences, especially in the realm of income inequality. Societies become richer as a whole, because technological change leads to greater productivity and the high-level paying jobs start paying much more highly. As a corollary, societies also tend to become more unequal in situations of labour market polarisation, which means the higher-paying jobs pay more highly, the lower-paying jobs stagnate or diminish, and the mid-level section of the economy evaporates.

This is where the interplay between the polarisation of the labour market and upgrading comes in, and becomes especially relevant for the political economy of countries most afflicted by populism.
In order to upgrade skills, labourers require investment, access to education and a very solid welfare state. Where such conditions are not present, technological automation tends to lead to labour market polarisation, as has happened in Central and Eastern European countries and to some extent Great Britain and the United States. Where such support from the welfare state does exist, technological automation is more likely to lead to upgrading and a general move of employment toward the upper rungs of income, as in the Scandinavian societies and Northern Europe in general. Of course, even these countries will encounter some rising inequality and, separately or consequentially, some increases in the presence of populist parties – but this diversity of national political economy influences the variation of fodder for populist parties. While Scandinavian countries have seen minor movement of this type, toward 10-12% of the electoral share, we can safely say that the CEE countries have seen this rise to a much greater extent, with populist parties taking over half of the vote in elections.

Societies become richer as a whole, because technological change leads to greater productivity and the high-level paying jobs start paying much more highly.

Such people suffer from status deprivation rather than material deprivation, as they are almost never the poorest members of society – in fact, quite the opposite. The process of technological change is generally slow and multi-layered, often accompanied by horizontal economic expansion. Even if a class of workers loses employment because their jobs entail routine activities, an economy in full expansion will likely easily find ways to re-accommodate them into employment. Similarly, an expanding economy will not adopt technological solutions abruptly, but will likely phase them out over time, in accordance with business cycles and private sector strategies. The opposite is true of economies that find themselves in times of economic compression, as they will much more likely adopt technological solutions in a sudden and potentially disorienting manner.

What is special about technological change in CEE?

In this context, the economic conditions paving the way for the surge of populist parties are difficult to pick up in macro-level data. On the whole, such data would show a booming recovery after the crisis, with many jobs created.

In a situation of labour market polarisation, the overall rise in higher-paid employment could also mask these economic effects through increases in GDP growth, while the contextual surfacing of routine cognitive employment (which we would expect to be more highly paid) would also partially mask the growth in inequality. In such a context, a decidedly economic vulnerability created by technological change leaving people behind, together with a weak state which is unable to pick them up again, would more likely be seen within a cultural framework, when the level of threat and instability felt by individuals finds an outlet in anti-globalist political attitudes and beliefs.

A series of articles from the Polish Institute of Structural Research points to the fact that most of the jobs recovered in CEE countries after the financial crisis have been jobs that are significantly vulnerable to technological automation (Hardy, Keister, and Lewandowski 2016; Keister and Lewandowski 2017). This ultimately means that citizens of CEE countries – even the countries that seem to have weathered the crisis well from a macroeconomics perspective – are likely to be vulnerable to impending changes. More so, these threats are relatively apparent to the workers themselves. Squeezed by a labour market pressure that they can scarcely understand, citizens are more vulnerable to facile scapegoating or fear-mongering.
While they do not necessarily understand that technology is to blame for their vulnerability, they do feel an increasing sense of vulnerability and instability – which they easily attribute to factors regarding globalisation. The people affected generally keep their middle-class label, but they perceive a much higher level of threat to their status and economic situation. As a result, they tend to look to the things that have changed concurrently with their perceived economic safety – and mostly, the accompanying phenomena are related to globalisation and cultural progressiveness. Post hoc ergo propter hoc: they perceive their loss of status and safety as a result of globalisation and cultural revolution, so they ascribe the responsibility for the change to globalisation and the cultural revolution, and therefore become adamantly opposed to them, which makes them ideal supporters of populist parties.

The main problem for Central and Eastern European countries is that to a certain extent globali- sation has also been part of the reason for their re- cent economic growth. (…) As such, we have the rather strange sight of po- litical leaders in Hungary and Poland railing against globalisation, while at the same time introducing and maintaining a highly glo- balised and liberalised po- litical-economic model in their own countries.

The main problem for Central and Eastern European countries is that to a certain extent globalisation has also been part of the reason for their recent economic growth. Export-heavy economies such as the Visegrad group have absorbed a lot of the industry that used to function in Western Europe. This export-based model is one of the main reasons for the incredible economic growth that has been registered in CEE countries and, together with the lower wages, is at least in part the reason why the post-crisis employment recovery also featured routine jobs. These jobs, had they been required to remain in Western European countries, with Western European wages, trade unions and branch contracts, would have likely been automated. By moving them to CEE countries instead, these jobs can survive – at least temporarily.

The problem is that this transition of employment also places political pressure on the leaders of CEE countries – all trying to emulate the Visegrad export-heavy model – to continue to offer de-regulation and liberalisation of their labour markets. This employment can only survive while the low wages and market regulations make automation an investment that is not yet worth the cost. As such, we have the rather strange sight of political leaders in Hungary and Poland railing against globalisation, while at the same time introducing and maintaining a highly globalised and liberalised political-economic model in their own countries.

What is to be done?

The quality of public services that a country has to offer – especially for people trying to readjust to the modern labour market – is key to understanding whether technological change will contribute to the increase in the populists’ electoral share or not. Technological change is difficult to avoid, especially within a common market such as the European Union. The only short-term alternative to technological upgrade is poverty and marginalisation, which would likely lead to migration, and ultimately offer the same result in the long run, but with a heftier price.

Societies cannot choose to avoid technological change in order to preserve economic equality, even if they wanted to. Also, because of the nature of this change, societies can hardly choose to control the flow of globalisation without also in part sacrificing economic growth. The solution in this context would be to invest in high- quality public services, especially life-long education, which could to some extent mitigate the polarising effects of technological change; health care, to prolong the careers of workers and their quality of life; and other such services.

If these services are not developed or provided, populist political leaders will likely be in a good position to capture large swaths of a jaded and at times angry electorate. Unfortunately, the history and present of the CEE countries shows that such a transition is unlikely in the short run, and in the light of the current political offers, to compete against populism.

DANI SANDU is researcher at the Social and Political Sciences Department of the European University Institute in Florence. His main project focuses on the effects of political socialisation under communism on the political attitudes and behaviours of citizens now living in post-communist democracies.