Trust in public institutions keeps declining. This week the disdain went a step further

Extract from The Guardian

Peter Lewis

While the rise of isolationist populism is a crisis for the left, it is poses a more existential challenge to free market capitalism

‘You might take umbrage at the crude racism, but their siren’s song resonates because it is based on a simple truth: that the wealth that is generated by this globalised economy is not being shared equally.’ Photograph: Rebecca Vale / Alamy/Alamy

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@PeterLewisEMC

Wednesday 2 November 2016 06.00 AEDT 

These are anxious times as we wait to see if the United States shoots itself in the head. And it’s not just about how this weird reality TV shows ends because whatever is going on, we are part of it too.
Trump, Brexit and One Nation are all warning signs that western societies are approaching a tipping point where the citizenry turn their back on the “rational” consensus of globalisation and revert to the “irrational” comfort of the nation state.
As a pollster I can attest to the one truth about populism: by definition it’s popular.
Across western democracies voters are ripe for seduction by showmen and women who stand outside the despised political class, preaching higher walls for jobs and people.

You might take umbrage at the crude racism, but their siren’s song resonates because it is based on a simple truth: that the wealth generated by this globalised economy is not being shared equally.
The figures now seem so familiar they cease to shock. In the US the estimate is that the top 1% account for 40% of the nation’s wealth, more than the combined wealth of the bottom 90%. In Australia the gap is not quite as pronounced, but it’s widening.
The rise in inequality has been underpinned by the destruction of permanent work, the annihilation of industries that once anchored productive lives, and the new scourge of the share economy, where you no longer have a career but perform tasks on demand.
And when we look forward, we can see no brighter future for our kids – we think it will be harder for them to have a steady job, to get a house. The old deal to “work hard, get ahead” has been broken.
The rise in rightwing populism has rightly created soul-searching on the progressive left, whose whole mythology has been built into politics representing the working class and the dispossessed.
Since the end of the cold war, the left’s agenda has been based around its commitment to the role of government as a buffer to the excess of capitalism, even as it has waved through privatisation and outsourcing.
But as the power of government to manage the power of global capital has been reduced by the slow drip, drip of free trade agreements and deregulation, the public has lost faith in the state to be part of the solution.
Our Essential poll has tracked a gradual decline in trust in public institutions over the past decade; while a new question we asked this week takes this disdain a step further.Most Australians say inequality worsening and want major rise in minimum wage.

We wanted to test whether a lack of personal respect was at the heart of our dissatisfaction – what we found was that people basically feel respected by everyone except the government.
While the big global corporations have shifted jobs offshore, closed industries and turned tax evasion into an art-form in ways that give it greater and greater power, it is the government we blame for letting them get away with it.
But in blaming government for the crisis before us, we risk rejecting the only means of restoring a semblance of balance to the system.
And as polling commissioned by United Voice to be released today illustrates, here’s where the public’s attitudes get even more complex:

While a significant majority of us believe Australia is getting more unequal – and even more of us believe this is a bad thing – we don’t have faith in the traditional tools of government to address the issue via taxation.
Voters strongly reject the idea of inheritance taxes or reviews to the way property and shares are taxed, even when living through an historic widening of the capital: wages gap share.
Only last week the rock-star of inequality economics, Thomas Piketty was packing out the Opera House – but while we accept his premise we don’t warm to his solution.

Where we do see merit is in a “significant” increase to the minimum wage, a direct transfer of wealth from capital to labour and we see unions with a role to play in redressing inequality.
Ironically it is these direct interventions into the labour market, anathema to free market economists, that could represent capitalism’s best chance of withstanding the populist challenge.
Because while the rise of isolationist populism is a crisis for the left, it poses a more existential challenge to free market capitalism.
As Paul Mason, the author of Post-Capitalism argues in the New Statesman, the biggest losers from Brexit are not the working people who have voted for it, though for them it won’t be pretty, but the 21st century model of capitalism itself.
After 30 years of fighting with governments and unions to free themselves from their obligations to the public, global capital’s total victory has led it to this populist precipice.

Mason argues that faced with Britain’s populist surge, the left has an historic opportunity to rescue global capital’s elites by demanding that if their system doesn’t deliver for the majority, its days are numbered.
By re-framing the focus from the old tensions between capital and labour to one between openness and creeping fascism, Mason finds a common enterprise in digging the British ruling class out of its self-made hole.
But, he warns “the price is: no return to the philosophy of poverty and inequality, a strategic new deal, one that puts state ownership, redistribution and social justice at the heart of post-Brexit consensus.”
The specifics are different in the USA as they are in Australia, but the sentiment holds.
If the system of global capital is to survive populism it will need to deliver more equal societies that provide people with financial and employment security and a greater sense that the system works for everyone.
It’s either that or the guy with the rug rules the world. If not this time, then some time soon.