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Trump’s triumph is commonly attributed to the marginalised voters favouring his populism, fuelled by a rage against rising income inequality. This research by Brian Nolan, Professor of Social Policy at Oxford University, shows, however, that the widespread rise of populism in other Western countries can be attributed instead to a general distrust in economic conditions. On a similar note, we came across a humorous article by Jim O’Neill, a former banker and UK Treasury Minister, now Chair of Chatham House, who explores how Western leaders are blindly following Trump’s populist playbook because his precedence makes them feel that now ‘it’s allowed’. O’Neill believes that the Fed can’t be a saviour for Trump’s reckless behaviour and that growth will be driven by the Chinese, not the American middle class.
Why does this matter? It has become somewhat trendy to condemn populism as the new plague of the West. While many of the new leaders might portray populist characteristics, it’s important to avoid getting bogged down by the label and focus on the tangible economic issues at play.
(The commentary contained in the above article does not constitute an offer or a solicitation, or a recommendation to implement or liquidate an investment or to carry out any other transaction. It should not be used as a basis for any investment decision or other decision. Any investment decision should be based on appropriate professional advice specific to your needs.)
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