The common belief that rising inequality fuels right-wing populism is empirically weak, argues LSE Dean Andres Velasco. Populism has surged in egalitarian countries like Sweden and Germany, and in places like Chile where inequality was falling, suggesting other cultural and political factors are more significant drivers.
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The rise of populism is better understood as a resurgence of humanity's innate "groupish" and tribal instincts. This regression is amplified by a modern cocktail of social media, rapid migration, and weakening political institutions, making it a deeper cultural and psychological phenomenon than just an economic one.
The global rise of right-wing populism cannot be solely attributed to economic factors like inequality or job loss. Its prevalence in wealthy, low-inequality nations like Sweden and strong manufacturing countries like Germany proves the root cause is a deeper, more widespread cultural anxiety.
The appeal of a populist leader lies in their rejection of traditional political norms. When the electorate feels betrayed by the established "political class," they gravitate toward figures whose rhetoric is a deliberate and stark contrast, signaling they are an outsider.
Traditional center-left parties are losing influence because they lack a coherent agenda to address the modern drivers of voter discontent. Their continued focus on narrow economic solutions is ineffective against the powerful cultural, identity-based, and technological forces that are actually shaping politics and fueling populism.
Left-leaning parties are losing worldwide because they offer economic solutions (e.g., more government programs) to what is fundamentally a cultural problem. Voters feeling existential anxiety from globalization and social change are drawn to the right's message of nostalgia and tradition, not the left's policy proposals.
Populist figures don't create societal problems; they rise to power because existing economic and social issues create an environment where their message resonates. To solve the problem, you must address the underlying conditions, not just the leader who represents them.
Extreme inequality and inflation, driven by debt and money printing, create widespread frustration. This frustration "summons" populist figures like Trump, who are seen as chaos agents to disrupt a rigged system, rather than being the root cause of the political anger themselves.
Figures like Donald Trump don't create populist movements; they rise by capitalizing on pre-existing societal problems like economic despair. Focusing on removing the leader ignores the root causes that allowed them to gain power, ensuring another similar figure will eventually emerge.
In times of economic inequality, people are psychologically driven to vote for policies that punish a perceived enemy—like the wealthy or immigrants—rather than those that directly aid the poor. This powerful emotional desire for anger and a villain fuels populist leaders.
The psychological engine of populism is the zero-sum fallacy. It frames every issue—trade deficits, immigration, university admissions—as a win-lose scenario. This narrative, where one group's success must come at another's expense, fosters the protectionist and resentful attitudes that populist leaders exploit.
