“Popular” is not “populist”

A nice little interview with hedgie Michael Hinze today at the AFR raises some good questions:

The Australian hedge fund manager is convinced the effects of QE have helped fuel populist politics. London-based Sir Michael has said the next generation of Brits will be better off after Brexit, and donated to the Leave campaign, although the Conservative party supporter did not actively advocate for the Leave vote during the referendum.

…Sir Michael says that French economist Thomas Piketty, the author of Capital in the Twenty-First Century, has a “serious point”. The bestseller examined how income inequality is exacerbated when the return on capital exceeds the rate of economic growth, and proposes a wealth tax.

“This Gini coefficient has changed remarkably since the GFC. Why? Because QE pumped up assets massively.”

All solid reasoning. But let’s get this populism definition correct. Brexit is not “populist” it is “popular” and will benefit ordinary Brits as immigration falls and wages rise while it hurts British capital.

Populism is “bread and circuses” politics. It is the elite taking on the trapping of working people to make it appear that they are in it for them while they do the exact opposite in reality. It is the difference between appearing to be of the people versus being for the people.

Donald Trump is populist. He championed working class people then slashed tax rates for the ultra-rich and corporations. His later policies may or not benefit working people. Time will tell.

Australia’s so-called “populists” are also, rather, “popular”. One Nation’s agenda, for instance, would lower immigration and increase wages benefiting working Australians while capital would suffer as house prices fall. MB disagrees strongly with race politics but agrees with these economics so we are also in the “popular” camp.

Likewise Australia’s other challenges in the need for reform to competition, energy, finance, productivity, reduced tax concessions etc are all utilitarian “popular” policies aiming to benefit the most possible Australians.

Ironically, those elites that condemn this agenda and label it “populist”, the bankers, miners, rentiers and China apologists of all stripe, are the true populists.

Comments

  1. FiftiesFibroShack

    Largest wealth gap since the 1930s coinciding with the rise of populists. Coincidence or directly related? I’m sure the occasional terror attack is a driver too.

    And populism isn’t just what you outline; populists also use statistically unlikely possibilities to play to public prejudice to further demonise ‘other’ groups. They play to our tribal instincts and create “with us or against us” type scenarios and encourage a kind of unthinking patriotism.

    • Relevant StakeholderMEMBER

      Yep, continue thinking your opposition are morons with psychological problems who don’t know what’s good for them!

      It’s been working so well for you!

      • To be fair, most people are morons with psychological problems who don’t know what’s good for them.

      • The Traveling Wilbur

        To be accurate most people are morons with psychological problems who are sure they know what’s best for everyone.

  2. “Ironically, those elites that condemn this agenda and label it “populist”, the bankers, miners, rentiers and China apologists of all stripe, are the true populists.”
    Yes!
    Add to that the MSM who benefit directly from populist headlines.

  3. “This Gini coefficient has changed remarkably since the GFC. Why? Because QE pumped up assets massively.”

    Yep, so working class people who earn wages cannot afford to buy a simple home for themselves. Beautiful isn’t it.

  4. And why was QE possible? Because of our central banking fiat monetary system which has little in the way of safeguards to protect the purchasing power of ordinary plebs. It therefore follows that future financial crises will always enrich the owners of capital at the expense of the working class proletariat. We need fundamental reform of the financial system and credit creation if we are truly serious about solving income and wealth inequality. Everything else is just noise.

    • Bingo!
      The monetary system is what needs reforming not the tax system. I’m surprised that Hintze gives props to Piketty who is nothing more than a Keynesian fluffer.

      Is Hintze genuinely ignorant or is he being expedient? While many wealthy Brits would be hammered by higher taxes you have to presume that Hintze’s tax arrangements provide a more-than-sufficient shield should a future Govt ever take his advice 😉

    • +1 as long as a banker can write a $1,000,000 loan on $15,000 security and be too big to fail and charge interest on it what is the point of working on an hourly rate?

Leave a reply

You must be logged in to post a comment. Log in now