Tag Archives: Democracy

Manifesto For The Democratisation Of Europe –  Thomas Piketty and Antoine Vauchez.

A concrete plan to democratise European institutions and policies, with a view to bringing more fiscal and social justice.

Europe will only reconnect with its citizens if it proves it has the ability to bring about genuine European solidarity, by having the main beneficiaries of the globalization process fairly contribute to the financing of the public goods Europe desperately needs.

In a critical moment for Europe, this Manifesto proposes to escape immobilism and abstract discussions by putting on the table a concrete plan to democratise both European institutions and policies, with a view to bringing more fiscal and social justice and to effectively address Europe’s environmental and migration emergencies.

The new European governance that has consolidated over the past decade in the wake of the financial crisis is not only opaque and unaccountable as epitomized by the Eurogroup; it is also ideologically biased towards economic policies with an almost exclusive focus on financial and budgetary objectives. Unsurprisingly, Europe has proved unable to take up the challenges with which it is confronted: growing inequalities across the continent, the acceleration of global warming, the influx of refugees, structural public under-investment (most notably in universities and research), tax fraud and evasion…

Our proposal empowers those member states that wish to address the current political and social crisis of the European project by proposing a budget of long-term investments in public assets of a European scale with a view to fighting social inequalities at EU level, and to securing the long-term viability of a genuine political model of social, fair and sustainable development in Europe.

Financing of the Budget is based on fiscal solidarity through the creation of four European taxes (on high incomes, on wealth, on carbon emissions and a harmonized corporate profits’ tax). To date, European integration has primarily benefited the most powerful and most mobile economic and financial agents: major multinationals, households with high incomes and large assets. Europe will only reconnect with its citizens if it proves it has the ability to bring about genuine European solidarity, by having the main beneficiaries of the globalization process fairly contribute to the financing of the public goods Europe desperately needs.

Such policies are virtually impossible in the current institutional framework, in particular because of the veto right of each country preventing any common fiscal policy. The Treaty for the democratization of Europe (T-Dem) sets the stage for a renewed democratic framework where these new economic policies, in particular the Budget, would not only be possible but also legitimate.

By creating a European Assembly in charge of deliberating and voting upon this Budget, member states can put themselves in a position to tax fairly the most prosperous actors and thus to finance the proposed common budget. With its mixed composition, including national and European members of Parliament, the European Assembly would also have the legitmacy to act as a counter-balance to the ever-growing impact of Europe’s economic governance on national social pacts.

Manifesto For The Democratization Of Europe

We, European citizens, from different backgrounds and countries, are today launching this appeal for the in-depth transformation of the European institutions and policies. This Manifesto contains concrete proposals, in particular a project for a Democratization Treaty and a Budget Project which can be adopted and applied as it stands by the countries who so wish, with no single country being able to block those who want to advance. It can be signed on-line (www.tdem.eu) by all European citizens who identify with it. It can be amended and improved by any political movement.

Following Brexit and the election of anti-European governments at the head of several member countries, it is no longer possible to continue as before. We cannot simply wait for the next departures, or further dismantling without making fundamental changes to present-day Europe.

Today, our continent is caught between political movements whose programme is confined to hunting down foreigners and refugees, a programme which they have now begun to put into action, on one hand. On the other, we have parties which claim to be European but which in reality continue to consider that hard core liberalism and the spread of competition to all (States, firms, territories and individuals) are enough to define a political project. They in no way recognise that it is precisely this lack of social ambition which leads to the feeling of abandonment.

There are some social and political movements which do attempt to end this fatal dialogue by moving in the direction of a new political, social and environmental foundation for Europe. After a decade of economic crisis there is no lack of these specifically European critical situations: structural under- investment in the public sector, particularly in the fields of training and research, a rise in social inequality, acceleration of global warming and a crisis in the reception of migrants and refugees. But these movements often have difficulty in formulating an alternative project, and in describing precisely how they would like to organise the Europe of the future and the decision-making infrastructure specific to it.

We, European citizens, by publishing this Manifesto, Treaty and Budget, are making specific proposals publicly available to all. They are not perfect, but they do have the merit of existing. The public can access them and improve them. They are based on a simple conviction. Europe must build an original model to ensure the fair and lasting social development of its citizens. The only way to convince them is to abandon vague and theoretical promises. If Europe wants to restore solidarity with its citizens it can only do so by providing concrete proof that it is capable of establishing cooperation between Europeans and by making those who have gained from globalisation contribute to the financing of the public sector goods which are cruelly lacking in Europe today. This means making large firms contribute more than small and medium businesses, and the richest taxpayers paying more than poorer taxpayers. This is not the case today.

Our proposals are based on the creation of a Budget for democratization which would be debated and voted by a sovereign European Assembly. This will at last enable Europe to equip itself with a public institution which is both capable of dealing with crises in Europe immediately and of producing a set of fundamental public and social goods and services in the framework of a lasting and solidarity-based economy. In this way, the promise made as far back as the Treaty of Rome of ‘harmonisation of living and working conditions’ will finally become meaningful.

This Budget, if the European Assembly so desires, will be financed by four major European taxes, the tangible markers of this European solidarity. These will apply to the profits of major firms, the top incomes (over 200,000 Euros per annum), the highest wealth owners (over 1 million Euros) and the carbon emissions (with a minimum price of 30 Euros per tonne). If it is fixed at 4% of GDP, as we propose, this budget could finance research, training and the European universities, an ambitious investment programme to transform our model of economic growth, the financing of the reception and integration of migrants and the support of those involved in operating the transformation. It could also give some budgetary leeway to member States to reduce the regressive taxation which weighs on salaries or consumption.

The issue here is not one of creating a ‘Transfer payments Europe’ which would endeavour to take money from the ‘virtuous’ countries to give it to those who are less so. The project for a Treaty of Democratization (www.tdem.eu) states this explicitly by limiting the gap between expenditure deducted and income paid by a country to a threshold of 0.1% of its GDP. The real issue is elsewhere: it is primarily a question of reducing the inequality within the different countries and of investing in the future of all Europeans, beginning of course with the youngest amongst them, with no single country having preference.

Because we must act quickly but we must also get Europe out of the present technocratic impasse, we propose the creation of a European Assembly. This will enable these new European taxes to be debated and voted as also the budget for democratization. This European Assembly can be created without changing the existing European treaties.

This European Assembly would of course have to communicate with the present decision-making institutions (in particular the Eurogroup in which the Ministers for Finance in the Euro zone meet informally every month). But, in cases of disagreement, the Assembly would have the final word. If not, its capacity to be a locus for a new transnational, political space where parties, social movements and NGOs would finally be able to express themselves, would be compromised. Equally its actual effectiveness, since the issue is one of finally extricating Europe from the eternal inertia of inter-governmental negotiations, would be at stake. We should bear in mind that the rule of fiscal unanimity in force in the European Union has for years blocked the adoption of any European tax and sustains the eternal evasion into fiscal dumping by the rich and most mobile, a practice which continues to this day despite all the speeches. This will go on if other decision-making rules are not set up.

Given that this European Assembly will have the ability to adopt taxes and to enter the very core of the democratic, fiscal and social compact of Member states, it is important to truly involve national and European parliamentarians. By granting national elected members a central role, the national, parliamentary elections will de facto be transformed into European elections. National elected members will no longer be able to simply shift responsibility on to Brussels and will have no other option than to explain to the voters the projects and budgets which they intend to defend in the European Assembly. By bringing together the national and European parliamentarians in one single Assembly, habits of co- governance will be created which at the moment only exist between heads of state and ministers of finance.

This is why we propose, in the Democratization Treaty available on-line (www.tdem.eu), that 80% of the members of the European Assembly should be from members of the national parliaments of the countries which sign the Treaty (in proportion to the population of the countries and the political groups), and 20% from the present European parliament (in proportion to the political groups). This choice merits further discussion. In particular, our project could also function with a lower proportion of national parliamentarians (for instance 50%). But in our opinion, an excessive reduction of this proportion might detract from the legitimacy of the European Assembly in involving all European citizens in the direction of a new social and fiscal pact, and conflicts of democratic legitimacy between national and European elections could rapidly undermine the project.

We now have to act quickly. While it would be desirable for all the European Union countries to join in this project without delay, and while it would be preferable that the four largest countries in the Euro zone (which together represent over 70% of the GNP and the population in the zone) adopt it at the outset, the project in its totality has been designed for it to be legally and economically adopted and applied by any sub-set of countries who wish to do so. This point is important because it enables countries and political movements who so desire to demonstrate their willingness to make very specific progress by adopting this project, or an improved version, right now. We call on every man and woman to assume his or her responsibilities and participate in a detailed and constructive discussion for the future of Europe.

Drafted by the following seven authors:

Manon Bouju, économiste

Lucas Chancel, vice-président du World Inquality Lab, Paris School of Economics

Anne-Laure Delatte, economiste, CNRS Research fellow

Stephanie Hennette-Vauchez, juriste, professeure à l’Université Paris Nanterre

Thomas Piketty, economiste, professeur à la Paris School of Economics et à l’Ecole des hautes études en sciences sociales

Guillaume Sacriste, politiste, maître de conférence à l’Université Paris 1-Sorbonne

Antoine Vauchez, politiste, CNRS Research professor, Université Paris 1-Sorbonne

and signed by scores of others

Social Europe

Manifesto for the democratisation of Europe

Download complete Manifesto PDF

LET’S MAKE THE HUMAN FOOTPRINT EVEN BIGGER. U.S. billionaires are fuelling the hard-right cause in Britain – George Monbiot * DARK MONEY. The Billionaires Behind the Rise of the Radical Right – Jane Mayer.

“A stunning record of corporate malfeasance.”

Dark money is among the greatest current threats to democracy. It means money spent below the public radar, that seeks to change political outcomes. It enables very rich people and corporations to influence politics without showing their hands.

Despite having been elected as a populist outsider, Trump put together a transition team that was crawling with the kinds of corporate insiders he had vowed to disempower.

“This whole idea that he was an outsider and going to destroy the political establishment and drain the swamp were the lines of a conman, and guess what, he is being exposed as just that.”

Among the world’s biggest political spenders are Charles and David Koch, co-owners of Koch Industries, a vast private conglomerate of oil pipelines and refineries, chemicals, timber and paper companies, commodity trading firms and cattle ranches. If their two fortunes were rolled into one, Charles David Koch, with $120bn, would be the richest man on Earth.

In a rare public statement, in an essay published in 1978, Charles Koch explained his objective. “Our movement must destroy the prevalent statist paradigm.” As Jane Mayer records in her book Dark Money, the Kochs’ ideology, lower taxes and looser regulations, and their business interests “dovetailed so seamlessly it was difficult to distinguish one from the other”. Over the years, she notes, “the company developed a stunning record of corporate malfeasance”. Koch Industries paid massive fines for oil spills, illegal benzene emissions and ammonia pollution. In 1999, a jury found that Koch Industries had knowingly used a corroded pipeline to carry butane, which caused an explosion in which two people died. Company Town, a film released last year, tells the story of local people’s long fight against pollution from a huge paper mill owned by the Koch Brothers.

They have poured hundreds of millions of dollars into a network of academic departments, thinktanks, journals and movements. And they appear to have been remarkably successful.

The Koch network has helped secure massive tax cuts, the smashing of trade unions and the dismantling of environmental legislation.

But their hands, for the most part, remain invisible. A Republican consultant who has worked for Charles and David Koch told Mayer that “to call them under the radar is an understatement. They are underground.”

. . . The Guardian

DARK MONEY. The History of the Billionaires Behind the Rise of the Radical Right

Jane Mayer

“We must make our choice. We may have democracy, or we may have wealth concentrated in the hands of a few, but we can’t have both.” Louis Brandeis

Election night 2016 was a stunning political upset, auguring a new political order in almost every respect. Donald Trump, a billionaire businessman with no experience in elected office, running on a promise to upend the status quo, defeated Hillary Clinton, the designated heir to Barack Obama’s Democratic presidency. Trump’s triumph defied the predictions of almost every pundit and pollster. It rocked the political establishments in both parties, and sent shock waves around the globe. Markets trembled before recovering their equilibrium. The political world seemed to shift on its axis, spinning toward an unknown and unpredictable future.

Although Trump ran as a self-proclaimed outsider against what he portrayed as entrenched and corrupt political elites, there was an unexpectedly familiar representative of this moneyed class at his victory party in Manhattan. Standing with a jubilant smile amid the throng of revelers at the Hilton hotel in midtown Manhattan was David Koch.

During the presidential primaries, Trump had mocked his Republican rivals as “puppets” for flocking to the secretive fundraising sessions sponsored by David Koch and his brother Charles, co-owners of the second-largest private company in the United States, the Kansas-based energy and manufacturing conglomerate Koch Industries. Affronted, the Koch brothers, whose political spending had made their name almost shorthand for special-interest clout, withheld their financial support from Trump. As a result, the story line adopted by many in the media was that the Koch brothers in particular, and big political donors in general, were no longer a major factor in American politics. Trump had, after all, defeated far bigger-spending rivals, including Clinton.

It might be nice to think the era of big money in American politics is over, but a closer look reveals a far more complicated and far less reassuring reality.

Trump had indeed campaigned by attacking the big donors, corporate lobbyists, and political action committees that have come to dominate American politics as “very corrupt.” In doing so, he fed into a national, bipartisan outpouring of disgust at the growing extent to which campaigns have become little more than relentless pursuits of obscene amounts of cash. To the surprise of many, Trump and Bernie Sanders, the left-wing insurgent who challenged Clinton in the Democratic primaries, seemed to transform big political money from an advantage into a liability. Trump nicknamed Clinton “Crooked Hillary,” claiming that she was “100% owned by her donors.” By Election Day, the public’s trust in her was in tatters.

Improbably, Trump, a New York businessman who had global financial interests and who spent some $66 million of his own fortune to get elected, ran against Wall Street. He successfully positioned himself as pristine because he was a billionaire in his own right, rather than one beholden to other billionaires. In a tweet less than a month before the election, Trump promised, “I will Make Our Government Honest Again believe me. But first I’m going to have to #DrainTheSwamp.” His DrainTheSwamp hashtag became a rallying cry for supporters riled by the growing economic inequality in the country and intent on ending corruption in Washington, which they blamed for putting the interests of the rich and powerful over their own.

Yet as Ann Ravel, a Democratic member of the Federal Election Commission who had championed reform of political money for years, observed just days after Trump’s election, instead “the alligators are multiplying.”

Despite having been elected as a populist outsider, Trump put together a transition team that was crawling with the kinds of corporate insiders he had vowed to disempower. Especially prominent among them were lobbyists and political operatives who had financial ties to the Kochs. This was perhaps unexpected, because the Kochs had continued to express their distaste for Trump throughout the campaign. Charles Koch called himself a libertarian. He supported open immigration and tree trade both of which benefited his vast multinational corporation. He had denounced Trump’s plans to bar Muslim immigrants as “monstrous” and “frightening.”

Yet there were signs of a rapprochement. The chair of Trump’s transition team, Vice President elect Mike Pence, had been Charles Koch’s first choice for the presidency in 2012 and a major recipient of Koch campaign contributions. David Koch had personally donated $300,000 to Pence’s campaigns in the four years before Trump chose Pence as his running mate. Pence, who in the past had shared the Kochs’ enthusiasm for privatizing Social Security and denying the reality of climate change, had been a featured guest at a fund-raiser that David Koch hosted for about seventy of the Republican Party’s biggest political donors at his Palm Beach, Florida, mansion in the spring of 2016. He had also been slated to speak at the Kochs’ donor summit in August 2016, but canceled after joining the Republican ticket.

Meanwhile, Pence’s senior adviser in the sensitive task of managing Trump’s transition to power was Marc Short, who just a few months earlier had actually run the Kochs’ secretive donor club, Freedom Partners. This was the same elite group whose meetings Trump had ridiculed during the campaign.

The Kochs’ influence was also evident in the transition team members that Trump picked in the areas of energy and the environment, which were crucial to Koch Industries’ bottom line. For policy and personnel advice regarding the Department of Energy, an early chart of the transition team showed that Trump chose Michael McKenna, the president of the lobbying firm MWR Strategies, whose clients included Koch Industries. McKenna also had ties to the American Energy Alliance, a tax-exempt nonprofit that advocated for corporate-friendly energy policies, to which the Kochs’ donor group, Freedom Partners, had given $1.5 million in 2012. The group, which didn’t disclose its revenue sources, was a textbook example of the way secret spending by billion-dollar private interests aimed to manipulate public opinion.

Another lobbyist for Koch Industries, Michael Catanzaro, a partner at the lobbying firm CGCN Group, headed “energy independence” for Trump’s transition team and was mentioned as a possible White House energy czar. Meanwhile, Harold Hamm, a charter member of the Kochs’ donor circle, who became a billionaire by founding Continental Resources, an Oklahoma-based shale-oil company known for its enormously lucrative “fracking” operation, was reportedly advising Trump on energy issues and under consideration for a cabinet post, possibly energy secretary.

To the alarm of the scientific community, Trump chose Myron Ebell, an outspoken climate change skeptic, to head his transition team for the Environmental Protection Agency (EPA). Ebell too had Koch money ties. He worked at a Washington think tank, the Competitive Enterprise Institute. It didn’t disclose its funding sources, but in the past, it had been bankrolled by fossil fuel interests, including the Kochs. His stridently antiregulatory views meshed perfectly with theirs. The Kochs had long been at war with the EPA, which had ranked Koch Industries one of only three companies in America that was simultaneously a top ten polluter of air, water, and climate.

Joining Ebell on the transition team was David Schnare, a selfdescribed “free-market environmentalist” who had accused the EPA of having “blood on its hands.” Schnare worked for a think tank affiliated with the State Policy Network, which was also funded in part by the Kochs. He was reviled in environmental circles for hounding the climate scientist Michael Mann with onerous public records requests until the Virginia Supreme Court ordered him to desist in 2014. The Union of Concerned Scientists had described these actions against climate scientists as “harassment.”

Thus, less than a week after having been elected on a wave of populist anger, Trump appeared set to fulfill many of the special interests’ fondest dreams, including the deregulatory schemes of the Kochs. He promised to “get rid of” the EPA in “almost every form” and to withdraw from the 2015 international climate accord in Paris, and against the overwhelming scientific evidence to the contrary, he called climate change “a hoax”. The Trump transition had a selfimposed ethics code barring lobbyists from shaping the rules and staffing the departments in which they had financial interests, but in the early stages, at least, these commonsense strictures appeared to have been sidestepped.

Experts in government ethics were aghast. “If you have people on the transition team with deep financial ties to the industries to be regulated, it raises questions about whether they are serving the public interest or their own interests,” warned Norman Eisen, who devised the Obama administration’s conflict-of-interest rules. “Let’s face it, in the Beltway nexus of corporations and dark money, lobbyists are the delivery mechanism for speciaI-interest influence.” Peter Wehner, who served in the administrations of Ronald Reagan and both presidents Bush, told the New York Times, “This whole idea that he was an outsider and going to destroy the political establishment and drain the swamp were the lines of a conman, and guess what, he is being exposed as just that.”

The Kochs’ influence reached greater heights with Trump’s nomination of Mike Pompeo, a Republican congressman from Kansas, to direct the CIA. Pompeo was the single largest recipient of Koch campaign funds in Congress. The Kochs had also been investors, and partners, in Pompeo’s business ventures prior to his entry into politics. In fact, as Burdett Loomis, a University of Kansas professor of political science, noted, the future CIA director’s nickname was “the congressman from Koch.”

Helping to guide the transition team in these fateful choices was Rebekah Mercer, the daughter of Robert Mercer, the wealthy New York hedge fund manager who “out-Koched the Kochs” in 2014, as Bloomberg News put it, giving more money to their political club than even they had.

Clearly the reports of the Kochs’ political death in 2016 were exaggerated. While they had refrained from backing a presidential candidate, the tentacles of the “Kochtopus,” as their sprawling political machine was known, were already encircling the Trump administration before it had even officially taken power.

Many had counted the Kochs out after their refusal to back a presidential candidate. Their initial 2015 plan called for their donor group to spend an astounding budget of $889 million in order to purchase the presidency. But they sat out the primaries, as they had in the past, and then found their plan rudely upended when Trump emerged as the nominee. He was the only major Republican presidential candidate whom they opposed. Sidelined, they continued to withhold their support.

But while the media fixated on the extraordinary presidential race, the Kochs and their network of right-wing political patrons quietly spent more money than ever on the three-pronged influence-buying approach they had mastered during the previous forty years. They combined corporate lobbying, politically tinged nonprofit spending, and “down ballot” campaign contributions in state and local races, where their money bought a bigger bang for the buck.

Far from shutting their wallets, they simply downgraded their budget to $750 million and directed several hundred million dollars of it to races beneath the presidential level. Few noticed, but in 2016 Koch Industries and Freedom Partners poured huge sums into at least nineteen Senate, forty-two House, and four gubernatorial races as well as countless lesser ones all over the country.

They also mobilized what a 2016 study by two Harvard University scholars, Theda Skocpol and Alexander Hertel-Fernandez, described as an unprecedented and unparalleled permanent, private political machine. In fact, amazingly, in 2016 the Kochs’ private network of political groups had a bigger payroll than the Republican National Committee. The Koch network had 1,600 paid staffers in thirty-five states and boasted that its operation covered 80 percent of the population. This marked a huge escalation from just a few years earlier. As recently as 2012, the Kochs’ primary political advocacy group, Americans for Prosperity, had a paid staff of only 450.

The Kochs ran their political operation centrally like a private business, with divisions devoted to various constituency groups, such as Hispanics, veterans, and young voters. One of their top people explained that their aim during the 2016 election had been to target five million voters in eight states with key Senate races. In the past, labor unions probably provided the closest parallel to this kind of private political organizing, but they of course represented the dues of millions of members. In comparison, the Koch network was sponsored by just four hundred or so of the richest people in the country. It was for this reason that the Harvard scholars who studied it said that the Koch network was “like nothing we’ve ever seen.”

Irrespective of Trump, the Kochs and their fellow mega-donors succeeded in their chief political objective in 2016, which was to keep both houses of Congress under conservative Republican control, ensuring that they could continue to advance their corporate agenda. They succeeded in their secondary goal, too, which was to further crush the Democratic Party by continuing the nationwide sweep of state legislatures and local offices that they had begun in 2010. By controlling statehouses, they could dominate not just legislation but also the gerrymandering of congressional districts, in hopes of securing their grip on the House of Representatives for years to come.

Many of the races they backed were too minor to merit press attention. In Texas alone, they supported candidates in seventy-four different races, reaching all the way down to a county court commissioner. Thanks in no small part to huge quantities of targeted money spent by the Kochs and their allied donors, the Democratic Party lost both houses of Congress, fourteen governorships, and thirty state legislatures, comprising more than nine hundred seats, during Obama’s presidency. By the time the votes were tallied in the 2016 election, Republicans controlled thirty-two state legislatures, while Democrats controlled only thirteen. Five others were split. This imbalance posed a huge problem for Democrats not only in the present but for the future, because state legislatures serve as incubators for rising leaders.

The Kochs might have disavowed Trump, but in several important respects he was their natural heir and the unintended consequence of the extraordinary political movement they had underwritten since the 1970s. For forty years, they had vilified the very idea of government. They had propagated that message through the countless think tanks, academic programs, front groups, ad campaigns, legal organizations, lobbyists, and candidates they supported. It was hard not to believe that this had helped set the table for the takeover of the world’s most powerful country by a man who made his inexperience and antipathy toward governing among his top selling points.

Charles Koch’s mentor, the quasi-anarchist Robert LeFevre, had taught the Kochs that “government is a disease masquerading as its own cure.” Their extreme opposition to the expansions of the federal government that had taken place during the Progressive Era, the New Deal era, the Great Society, and Obama’s presidency had helped to convince voters that Washington was corrupt and broken and that, when it came to governing, knowing nothing was preferable to expertise. Charles Koch had referred to himself as a “radical,” and in Trump he got the radical solution he had helped to spawn.

The Kochs had also primed America for Trump by pouring gasoline on the fires lit by the antitax Tea Party movement starting in 2009. Charles Koch decried Trump’s toxic rhetoric in 2016, and David Koch complained to the Financial Times that “you’d think we could have more influence” after spending hundreds of millions of dollars on American politics. But in fact, the influence of the Kochs and their fellow big donors was manifest in Trump’s use of incendiary and irresponsibly divisive rhetoric. Only a few years ago, it was they who were sponsoring the hate.

In the 1960s, Charles Koch had funded the all-white private Freedom School in Colorado, whose head had told the New York Times that the admittance of black students might present housing problems because some students were segregationists. That was long ago, and his views, like those of many others, could well have changed. But in a 2011 interview with the Weekly Standard, David Koch echoed specious claims, made by the conservative gadfly Dinesh D’Souza, that Obama was somehow African rather than American in his outlook. He claimed that Obama, who was born in America and abandoned by his Kenyan father as a toddler, nonetheless derived his “radical” views from his African heritage.

The effort to attack Obama, not as a legitimate and democratically elected American political opponent, but as an alien threat to the country’s survival, was very much in evidence at a summit that the Kochs’ political organization Americans for Prosperity hosted in Austin, Texas, during the summer of 2010. Between Tea Party training sessions, operatives working for the Kochs gave an award to a blogger who had described Obama as the “cokehead-inchief” and asserted that he suffered from “demonic possession (aka schizophrenia, etc.).” The Kochs and other members of the Republican donor class might have disowned the vile language of the 2016 campaign, but six years earlier they were honoring it with trophies.

The same incendiary style characterized the big donors’ fight against the Affordable Care Act. Rather than respectfully debating Obama’s health-care plan as a policy issue, the Kochs and their allied donors poured cash into a dark-money group called the Center to Protect Patient Rights, which mounted a guerrilla war of fearmongering and vitriol. Television ads sponsored by the group featured the false claim that Obama’s plan was “a government takeover” of health care, which PolitiFact named “the Lie of the Year” in 2010. Meanwhile, a spin-off of Americans for Prosperity organized anti-Obamacare rallies at which protesters unfurled banners depicting corpses from Dachau, implying that Obama’s policies would result in mass murder.

Koch operatives also purposefully sabotaged the democratic process by planting screaming protesters in town hall meetings at which congressmen met with constituents that year. In short, during the Obama years, the Kochs radicalized and organized an unruly movement of malcontents, over which by 2016 they had lost control. “We are partly responsible,” one former employee in the Kochs’ political operation admitted to Politico a month before Trump was elected. “We invested a lot in training and arming a grassroots army that was not controllable.”

In other ways, too, the Kochs and their allied big donors became victims of their own success in 2016. They inadvertently laid the groundwork for Trump’s rise by too thoroughly capturing the Republican Party with their cash. Their narrowly self-serving policy priorities were at odds with those of the vast majority of voters. Yet virtually every Republican presidential candidate other than Trump pledged fealty to the donors’ wish lists as they jockeyed for their support. The candidates promised to cut taxes for those in the highest brackets, preserve Wall Street loopholes, tolerate the off-shoring of manufacturing jobs and profits, and downgrade or privatize middleclass entitlement programs, including Social Security. Free trade was barely debated. These positions faithfully reflected the agenda of the wealthy donors, but studies showed that they were increasingly out of step with the broad base of not just Democratic but also Republican voters, many of whom had been left behind economically and socially for decades, particularly acutely since the 2008 financial crash. Trump, who could afford to forgo the billionaires’ backing and ignore their policy priorities, saw the opening and seized it.

Whether Trump would fulfill his supporters’ hopes and break free from the self-serving elites whose money had captured the Republican Party prior to his unorthodox election remained to be seen. The early signs were not promising. Not only was Trump’s early transition team swarming with corporate lobbyists, including those who had worked for the Kochs, but Trump’s inaugural committee featured several members of the Kochs’ billion-dollar donor club, too. Neither Diane Hendricks, a building-supply company owner whose $3.6 billion fortune made her the wealthiest woman in Wisconsin, nor billionaire Sheldon Adelson, founding chairman and chief executive of the Las Vegas Sands Corporation casino empire, signaled a break from politics as usual.

Inaugurals had long been underwritten by rich donors, so perhaps reading too much into this was unfair. But Trump’s tax proposals, to the extent that they could be gleaned, were if anything even more of a bait and switch. While he had garnered bluecollar support by promising to stick it to the elites who “are getting away with murder,” his proposals, according to economic experts, threatened instead to enshrine a permanent aristocracy in America. He appeared poised to repeal the estate tax, presenting a windfall to heirs of estates worth $10.9 million or more. There had been fewer than five thousand estates of this size in 2015. He also had plans to abolish the gift tax, which put the brakes on inherited wealth. Capital gains taxes and income taxes for top earners were headed toward the chopping block, too. Charles and David Koch, who together were worth some $84.5 billion, stood to benefit to an extent that dwarfed earlier administrations, as did many other billionaires. As the headline on Yahoo Finance proclaimed on the day after the election, “Trump’s Win Is a ‘Grand Slam’ for Wall Street Banks.”

The fact of the matter was that while Trump might have been elected by those he described as “the forgotten” men, he would have to deal with a Republican Party that had been shaped substantially by the billionaires of the radical Right. He would have to work with a vice president once funded by the Kochs and a Congress dominated by members who owed their political careers to the Kochs. Further, he would have to face a private political machine organized in practically every state, ready to attack any deviation from their agenda. No one could predict what Trump would do. Nor could they predict how much longer the Kochs, by then in their eighties, would stay active. But one thing was certain. The Kochs’ dark money, which they had directed their successors to keep spending long after they had passed away, would continue to exert disproportionate influence over American politics for years to come.

November 2016 Washington, D.C.


DARK MONEY. The Hidden History of the Billionaires Behind the Rise of the Radical Right

by Jane Mayer

get it at Amazon.com




Why is populism suddenly all the rage? – Matthijs Rooduijn * IMF Report. Populism and Civil Society – Tito Boeri, Prachi Mishra, Chris Papageorgiou, Antonio Spilimbergo.

In 1998, about 300 Guardian articles mentioned populism. In 2016, 2,000 did. What happened?

What is populism?

Populists tend to frame politics as a battle between the virtuous ‘ordinary’ masses and a nefarious or corrupt elite and insist that the general will of the people must always triumph. The Guardian is adopting the classic definition of populism proposed by political scientist Cas Mudde. Populism, he says, is often combined with a “host” ideology, which can either be on the left or right.

Populism is as old as democracy itself, but the last 10 years have proven particularly fertile: populist leaders now govern countries with a combined population of almost two billion people, while populist parties are gaining ground in more than a dozen other democracies, many of them in Europe.

Populism is sexy. Particularly since 2016, the year of the Brexit referendum and the election of Donald Trump, it seems as if journalists just cannot get enough of it. In 1998, the Guardian published about 300 articles that included the terms “populism” or “populist”. In 2015, these terms were used in about 1,000 articles, and one year later this number had doubled to almost 2,000.

The increasing popularity of the term is no coincidence. Populist parties have tripled their vote in Europe over the past 20 years. They are in government in 11 European countries. More than a quarter of Europeans voted populist in their last elections.

Why? There is no easy answer to this question. Recent academic studies have shown that throughout the western world populist attitudes are widespread. Many citizens take the view that ordinary, virtuous people have been betrayed, neglected or exploited by a corrupt elite. Although citizens with strong populist attitudes do not necessarily vote for a populist party (in fact, many of them don’t), there are various circumstances that increase the likelihood that they will do so.

Firstly, when a society is more individualised, and voters are more independent and emancipated, electoral volatility tends to be higher. Such circumstances will enhance the probability that populist attitudes are translated into real populist votes. After all, without a certain degree of detachment from traditional mainstream parties, voters are unlikely to actually switch away from them and turn to populists.

Secondly, there is a fertile breeding ground for populists when mainstream left and right parties converge ideologically. If this is the case, many voters will be susceptible to the message that mainstream political parties are all one and the same. A good example is how in France the Front National (now National Rally) merged the names of the centre-right UMP and the centre-left PS into “UMPS” in its campaigning the political equivalent of Tweedledum and Tweedledee. Moreover, when mainstream parties converge, they leave fallow a lot of ideological space, and therefore tend to be unresponsive to the worries of more radical citizens.

Thirdly, crises can make the activation of populist attitudes more likely. A financial crisis, for instance, makes mainstream parties highly vulnerable to the critique that “the established elite” has messed things up. The European refugee crisis provided populist parties with ammunition for the argument that governing elites had opened up the borders and were unable to deal with the inflow of immigrants.

Fourthly, Widespread corruption plays straight into populist hands. If it turns out that political parties are highly corrupt, the populist claim that people are exploited by an inward-looking, condescending elite will find wide public support. This is exactly what happened in Italy in the early 1990s, for instance. As a result of a nationwide judicial investigation into bribery, nepotism and other forms of corruption, the whole party system was turned upside down. This cleared the way for the rise of populists such as Silvio Berlusconi and the League.

Yet a fertile breeding ground for populism is not enough for populism to thrive. There should also be a credible populist challenger who offers an attractive alternative to the existing parties. In order to be perceived as an attractive alternative, a challenger party needs to express a message that appeals to large numbers of discontented voters. Moreover, what also helps is an alluring leader and, especially in the long term, a well-functioning party organisation.

The changing media environment also plays a role. Because of dwindling subscription rates, traditional media increasingly focus on topics they expect to sell well, such as scandals and conflict, fuelling the sense of crisis that populists can draw on.

Of course, sociopolitical contexts vary by geography and so does populism. In northern Europe, successful populists are mainly radical rightwing populists. Parties such as the Danish People’s party, the Finns and the Sweden Democrats all combine a xenophobic nationalist outlook with a populist message. Leftwing populism is much less widespread in this part of Europe possibly because the strong economies and generous welfare systems of the Nordic countries make a radical leftwing populist message less pressing.

Southern Europe looks different. In countries such as Spain, Italy and Greece, populism is not exclusively a radical rightwing phenomenon. This might well be due to the fact that the financial crisis hit these countries harder than most. They therefore form the perfect setting for a leftwing populist message. Parties like Podemos in Spain and Syriza in Greece combine their populism with a radical leftwing main ideology. In Italy, the Five Star Movement combines populism with a diverse array of ideological stances.

Western Europe differs from southern Europe in that radical leftwing populists are less successful. This is most likely due to the fact that countries in this part of Europe have much stronger economies than their southern European neighbours. The exception that proves the rule is Ireland. This country did not perform very well economically and harbours a relatively successful radical leftwing populist party: Sinn Féin.

The landscapes in central and eastern European countries look very different. Here, populism generally did not bob up at the fringes of the political spectrum, but in the centre. Parties such as Fidesz in Hungary and Law and Justice in Poland started their political lives as mainstream parties. Only later on did they also embrace populism and, even later, nativism. It is probably because these do not have radical heritages which could potentially thwart their “respectable” images that they have managed to become the leading parties in their respective countries.

Despite all these geographical differences, throughout Europe the breeding ground for populism has become increasingly fertile. And populist parties are ever more capable of reaping the rewards.

Matthijs Rooduijn is a political sociologist at the University of Amsterdam

The Guardian

See also:

IMF Report. POPULISM AND CIVIL SOCIETY – Tito Boeri, Prachi Mishra, Chris Papageorgiou, Antonio Spilimbergo.

IMF Report. POPULISM AND CIVIL SOCIETY – Tito Boeri, Prachi Mishra, Chris Papageorgiou, Antonio Spilimbergo.

“Despite popular perception there is not an overwhelming trend in favour of populism in Europe.”

Populism: An ideology that considers society ultimately separated into two homogeneous and antagonist groups, ‘the pure people’ versus the ‘corrupt elite’.

Populists claim to be the only legitimate representative of the people. Does this mean that there is no space for civil society?

What is peculiar about the recent wave is that populism has spread and sometimes became dominant in countries with well established liberal democracy.

Why do voters vote for parties which are ultimately against their own interest?

Our main finding is that individuals belonging to associations are less likely to vote for populist parties.

The issue is important because since Tocqueville (1835), associations and civil society have been recognized as a key factor in a healthy liberal democracy.

We ask two questions:

1) Do individuals who are members of civil associations vote less for populist parties?

2) Does membership in associations decrease when populist parties are in power?

We answer these questions looking at the experiences of Europe, which has a rich civil society tradition, as well as of Latin America, which already has a long history of populists in power.

The main findings are that individuals belonging to associations are less likely by 2.4 to 4.2 percent to vote for populist parties, which is large considering that the average vote share for populist parties is from 10 to 15 percent. The effect is strong particularly after the global financial crisis, with the important caveat that membership in trade unions has unclear effects.

1. History

Populism is not new. Waves of populism have spread through Russia and the US. at the end of the 19th century and through several European and Latin American countries in the 20th century. In previous episodes, populism remained marginal (like in Europe in the second half of the 20th century) or became dominant in weak democracies (like Latin America.) What is peculiar about the recent wave is that populism has spread and sometimes became dominant in countries with well established liberal democracy. This begs the question of how populism not only coexists but even thrives and prospers in liberal democracies.

What is populism?

Populism has been defined in various ways and is often used as a derogative term in political debates. In line with a common view in political science, we use the definition of populism as “an ideology that considers society ultimately separated into two homogeneous and antagonist groups, ‘the pure people’ versus the ‘corrupt elite’”.

The key issue of interest here is that the populist ideology considers the people as a monolith, and populist leaders claim to have the monopoly of political representation of the people. This monopoly on representing “the people” is almost a moral right which delegitimizes all other parties, associations, and groups in the populist discourse. In the populist view, a (corrupt and detached) elite is in opposition with the (homogenous and virtuous) ‘people.’ In the populists’ Manichean view, there is no intermediate space between the ‘virtuous people’ and the corrupt elites. This view is in contrast with the concept of liberal democracy.

Liberal democracies are political systems based on pluralism where different groups represent different interests and values, which are all legitimate provided they respect the rules. In liberal democracies, multiple political parties compete in free elections, branches of government are separated, and a system of checks and balances exists. Associations are formed to organize and give voice to these different values. Associations play a key role in liberal democracies.

Alexis de Tocqueville in his Democracy in America (1835) writes on the role of associations in democracies:

“Americans of all ages, all conditions, all minds constantly unite. Thus, the most democratic country on earth is found to be, above all, the one where men in our day have most perfected the art of pursuing the object of their common desires in common and have applied this new science to the most objects. Does this result from an accident or could it be that there in fact exists a necessary relation between associations and equality? All citizens are independent and weak; they can do almost nothing by themselves, and none of them can oblige those like themselves to lend them their cooperation. They therefore all fall into impotence if they do not learn to aid each other freely. If men who live in democratic countries had neither the right nor the taste to unite in political goals, their independence would run great risks, but they could preserve their wealth and their enlightenment for a long time; whereas if they did not acquire the practice of associating with each other in ordinary life, civilization itself would be in peril. The morality and intelligence of a democratic people would risk no fewer dangers than its business and its industry if the government came to take the place of associations everywhere. In democratic countries, the science of association is the mother science; the progress of all the others depends on the progress of that one.”

This citation illustrates well the role of associations in well functioning liberal democracies.

In sum, liberal democracies are pluralistic and associations are key to aggregation; in contrast, populists consider ‘the people’ as a homogeneous group, which cannot be divided.

But what is the role of associations if the populist leaders are the only legitimate representative of the people? This paper looks at the issue of single individuals’ preferences in a large sample of European and Latin American countries. Are individuals who belong to associations more prone to vote for populist parties? Did the global economic crisis and the Euro area crisis change this relation?

We test the hypothesis on whether belonging to a body in civil society (by belonging to a civil society association or a trade union) reduces the probability to vote (as stated in retrospective questions) for a populist party. We use several waves of the European Social Survey (ESS), which comprises more than 60,000 individual observations, covering 17 European countries with populist parties for about 15 years, and several waves of LatinBarometro, which covers all major Latin American countries for several years.

Our main finding is that individuals belonging to associations are less likely to vote for populist parties.

In Europe, individuals belonging to associations are 3.2 percent less likely to vote for populist parties during the post global financial crisis period. The result is driven specifically by membership in civil associations rather than trade unions. The finding is robust controlling for several variables that could co determine jointly the voting behaviour in favour of populist parties and the decision to join an association, and removing outliers to estimate a 2 step Heckman model that accounts for the probability of participation in voting.

We find qualitatively similar results for Latin America, where voting is compulsory, albeit with very limited data that precludes conducting several robustness checks. We interpret the findings as associations provide ideological anchors, identities, and voice mechanisms; as individual beliefs became more unhinged from ideological anchors post crisis, people felt more open to voting for new parties. Another interpretation is that associations promote social responsibility and acts as a protective shield against populism. Finally, it is not only that association members are less likely to vote for populist parties, but there is also some suggestive evidence for trade union density to be lower in countries where populists have been in power.

This paper makes contributions in three fields:

First, our approach is useful in explaining one of the puzzles that populism is generally not correlated to economic crisis. For instance, despite the deep economic crisis, Ireland and Iceland did not have strong populist movements. On the other hand, Poland, which did not experience a recession during the global financial crisis, has a party classified as populist in power. We investigate how the presence (or absence) of civil society can explain these differences across countries.

Second, there is an ongoing debate about the importance of economic versus cultural and social factors in explaining the rise of populism. Our approach focusing on the intermediate bodies argues that these factors need to be complemented as the spread of populist ideas depends on the presence of a civil society.

Third, our results provide indirect evidence for the old idea that populism may be the response of a society losing its ‘collective consciousness.’ The idea, which is old in sociology, is that a society needs a system of solidarity between individuals, providing cross-cutting social ties. When this system breaks down, individuals feel anemia and are ready to support new movements. According to this view, populists gain support after big shocks only if the society does not have enough intermediate institutions which provide an ‘ideological anchor’ to individuals.

The paper is organized as follows. Section 2 reviews the literature on populism and economics with a focus on the effect of the recent global financial and euro crises. Section 3 describes the data sources used in the empirical analysis and takes a first look at these data. Section 4 discusses the empirical strategy followed by Section 5 that reports and discusses the results. Section 6 looks at what happens to trade union membership when populists gain power. Section 7 draws conclusions.

2. Literature Review

The literature on the causes and the electoral success of populism is old and voluminous, but so far answers have been elusive to historians and political scientists. In this paper, we focus on three questions on which economists have focused:

1) What is the role of populism in rich postmodern societies and why has populism been on the rise even before the global financial crisis?

2) What are the effects of the global financial crisis and, in particular, the euro crisis on politics?

3) Why do voters vote for parties which are ultimately against their own interest?

Populism in post modem societies

The rise of populist parties in Europe since the 1980s has revived the literature on populism in political science. The success of (far right) populist parties in the last thirty years has been remarkable. With the Green Parties, the populist far right parties are the only new party family in Europe in the last seventy years and the only one to spread consistently in both Eastern and Western Europe. The reasons for the rise of populist parties are complex, involving both demand and supply factors, A key issue is the revival of populist parties in rich countries where democracy is well established.

Inglehart and Norris (2016) explore two leading explanations:

First, there is the widely held view that economic insecurity has caused the rise of populism. According to this view, deep structural transformations of the last fifty years have created economic uncertainty and social malaise, especially amongst the economic losers of these transformations.

The second view focuses on cultural backlash. In addition to deep economic changes, the last fifty years have seen profound social transformation; the introduction of new values in the society has caused a reaction in sectors of the population which felt threatened.

Using the European Social Survey, Inglehart and Norris (2016) find strong evidence in favour of the cultural backlash hypothesis. This finding suggests that the traditional left-right cleavage, on which politics was based before the 80s, is being substituted by a new cleavage between traditional and progressive values in (post modem) Western societies. Inglehatt and Norris (2016) also find evidence that the support for populist parties comes from small shop keepers and not from low wage workers and that unemployment status and income are bad predictors of populist votes.

The view that in post modern societies voting is more affected by cultural factors than by wealth or income is important for this paper. In fact, in a post modern world, associations, Which are part of the individual’s cultural world, should play an increasing role in determining voting intentions.

Are voters irrational?

Economists have found it particularly difficult to explain the success of populist parties because support for populism challenges the usual assumption in political economy that individuals act (and vote) following their own interests. Economists have long maintained that populists in power implement policies that in the long run damage the whole economy and, particularly, those groups that populists are supposed to favour. Why do people vote for populist movements that ultimately go against their own interests? If populism leads to bad economic consequences (as economists assume), why do people support populist parties?

This seems to violate the principle of rationality.

Economists provided different answers to this question. Dornbusch and Edwards (1992) argue that (most) voters are short sighted and often misinformed; this explains why they supported political movements in Latin America that promised wealth for everybody and ignored budget constraints. Caplan (2007) provides evidence that American voters do not behave rationally, at least in the economic sphere. Acemoglu et al. (2013) argue that populist policies are a signalling device by honest politicians directed to voters who have imperfect information about the politicians. Populist politicians choose ‘extremist’ policies to signal that they are not beholden to special interest. Di Tella and Rotemberg (2017) add voters’ distaste for ‘betrayal’ to a standard model and argue that voters prefer having incompetent leaders rather than feel betrayed. These explanations have merits, but also the big limit that they do not build on the insights of political science.

Finally, Rodrik (2017) argues that populism is a rational response to the shocks caused by globalization.

The views in this debate on the rationality of the voter span a wide range. However, all have the implicit assumption that the individual chooses (rationally or irrationally). Our paper innovates in this respect and shows that associations play a key role in explaining the populist votes.

Social Capital and populism

The role of social capital has been recognized in economics for a long time. Building on Tocqueville’s intuition, Putnam argues that social capital, which was key in building American society, has been declining since the 1960s. According to him, the decline in social capital has increased unhappiness and political apathy. Crucially, low level of social capital also decreases confidence in government and lowers frequency in voting and participating in political activity. In his original work, he did not deal directly with populism but all these correlates of social capital are often associated with populism. Satyanath et al. (2018) argue instead that there is a “dark side” of social capital, documenting that social capital aided the rise of the Nazi movement that ultimately destroyed Germany’s first democracy.

This paper also builds on this strand of the literature in linking social capital as measured by membership in association with populism.

Economic crises and populism

The global financial crisis (or Great Recession) in 2008/9 and the Euro crisis in 2012 have had unprecedented economic consequences; did the economic crises also cause political crises? After all, political crises and the ascent of Nazism followed the economic crisis in the thirties. Political scientists and economists give different answers to this question.

Rovira Kaltwasser, and Zanotti (2016) state that “in contrast to alarmist reports in the media claiming that the Great Recession is triggering the rise of anger, extremism and protest across Europe, most comparative (party) politics literature on the Great Recession tend to argue that so far the political consequences of the crisis have been limited.” The extended state of welfare is credited for preventing a different outcome than in the 30s. Moreover, the evidence points that the recession itself has not caused a large increase of votes for the French Front Nationale. The discontent caused by the economic crisis seems to have been channelled through retrospective voting (i.e. voters punish incumbents in government irrespective of their ideology). According to this view, the rise of populism after the Great Recession is the continuation of a pre-existing trend of punishment of the ruling class via voting for parties with mostly inexperienced politicians presenting themselves as anti establishment.

Economists hold the opposite view that the economic crises had profound political effects and, in particular, are fostering populism. Guiso et al. (2017), Algan et al. (2017), the EEAG report (2017), Dustmann et a1. (2017) argue that the crises and the attendant economic insecurity undermined trust in institutions, in particular, European institutions. Similarly, Funke et. al. (2017) find that voters flock to extremist parties, located at both ends of the political spectrum, after financial crises.

Contributing to this literature, our paper finds that the crises had indeed an effect on the voting preferences, but this was intermediated by associations. Results somewhat similar to ours were obtained by Coffé et al. (2007) in their analysis of the electoral success of the Vlaams Blok in the 2004 Flemish regional elections. They found the right wing populists to be particularly successful in municipalities with a small network of social organizations.

3. Data

This section starts with a brief account of the sources from which data were obtained followed by a first look at basic trends and descriptive statistics.


Our dataset is at an individual level and is drawn primarily from the European Social Survey (ESS). The ESS maps the attitudes, beliefs, and behaviour patterns to socio economic and demographic variables. The surveys take place every two years, though not all countries and individuals participate in all the waves. Therefore, we have a repeated cross section rather than a panel. The data measure voting patterns at the individual level. The ESS asks individuals whether they voted in the last Parliamentary election and if they did, which party they voted for. The sample covers 17 European countries over the period 2002-16.

We also use data on voting patterns in Latin America from the Latinobarometro. The Latinobarometro is also an individual level survey similar to ESS, though with very limited information, and reduced coverage, relative to the ESS. The Latinobarometro also measures voting behaviour but asks a different question: if individuals are asked to vote the following Sunday for Parliamentary or Presidential election, which party would they vote for. The data for Latin America is very limited, covering 17 countries from 1996-2008 with many gaps. Given the limited coverage, we exercise caution in interpreting the results for Latin America and treat them as only suggestive evidence.

To identify populist parties in Europe and Latin America, we follow the recent literature. Inglehart and Norris classify populist parties based on the 2014 Chapel Hill Expert Survey (CHES). The CHES uses expert ratings on position of parties on a range of characteristics such as support for traditional values, liberal lifestyles, and multiculturalism, including economic characteristics such as state of the economy, and market deregulation. Inglehart and Norris classify a party as populist if it scores more than 80 points on a standardized 100 point scale built using thirteen selected indicators contained in the CHES. This definition of populist party is time invariant. We follow the same methodology to classify populist parties in Europe and Latin America. Based on this methodology, we define 28 parties in Europe and 22 parties in Latin America as populist.

A key variable in our analysis is membership of civil society associations. We construct association membership rates for Europe using the ESS Membership of civil society associations is elicited from a question on personal involvement in actions “trying to improve things or help prevent things from going wrong”. We consider members of civil society associations those stating not to have “contacted a politician” or “worked in a political party”, or “belonging to any particular religion or denomination” but to have “worked in another organization or association during the last 12 months”. More specifically, an individual is defined to be a member of a civil society association, if during the last 12 months he has worked in an organization or association trying to improve things or help prevent things from going wrong in her country. In some specifications we also use a measure of self reported trade union membership, though we argue later in the paper that this measure is more likely to be contaminated by endogeneity concerns than membership of civil societies. We define an individual to be a member of a trade union if he/she is currently “a member of a trade union or similar organization”.

The Latinobarometro dataset also has information on whether an individual is a member of any association, including trade union, though the variable is not available for most years. Moreover, the exact definition of association membership in the Latinobarometro varies from year to year. In the 2008 survey, for example, the definition includes membership in trade or labor unions as well as groups or associations related to “politics , students , religious , culture , sport”, or “ecology”.

We use several other socio economic variables such as age, gender, income, and education. Details of all the variables used in the empirical analysis is provided in Table A2. Table A3 provides descriptive statistics for the variables used in the analysis.

A first look at the data

Before going into the econometric analysis, we analyse the evolution of our key variables over time and analyse simple correlations. In Europe, there is no clear trend in populist vote intention between 2002 and 2016. Close to 10 percent of the population said they would vote for populist parties in 2002; the figure increased to close to 15 percent by mid 2000, before beginning to decline again more recently. This is consistent with the fact that, despite popular perception, there is not an overwhelming trend in favour of populism in Europe.

For Latin America, we find a clear break in the trend towards populism. Populism was flat till mid 2000s but has increased sharply since then. The rise of populism in Europe till mid 2000s has coincided with a rather constant level of civil association membership whilst union membership has been on a declining trend. In general union membership rates display a much higher time variation than membership in civil society associations.

Only for selected countries in Europe, such as Turkey, populist in power were associated with declining membership of associations. In the case of Latin America, on average, association membership rates have decreased in parallel with a rise in populism. In Brazil and Argentina, the years when populists were in power were also years when membership of associations declined.

How does membership of civil society association interact with political preferences for populist parties? Do populism and decline in, broadly speaking, association membership rates (including unions) go hand in hand, or are they driven by a third factor? We analyse these issues more rigorously in the next section using a novel dataset on voting patterns and association membership rates.

4. Empirical specification. See the full report (download link below).

5. Empirical Results

This section first reports results using a large voting dataset from 17 European countries followed by results from a smaller yet quite representative dataset from 17 Latin American countries.

Baseline Evidence from European voting data

We first show results for drivers of voting for populists using the ESS. Our dataset includes observations from 17 European countries with eight waves.

Table 1-2 shows the results from estimating Equation (1) by OLS and Probit respectively. Column 1 pools data from all available years from 2002-2016. Our key variable of interest is membership in a civil association. The estimated coefficient for this variable is negative in Column 1 of Tables 1-2 i.e. individuals who belong to associations are less likely to vote for populist parties. The result holds also across all waves in Tables 1 and 2, with the exception of 2004 in Table 1.

The coefficient on civil association is about 3 percent. This is a large number considering that the average vote share for populist parties is between 10 and 15 percent in most countries. In other words, membership of civil society reduces the vote for populist party by 20 to 30 per cent.

In addition to membership in a civil organization, being female and having attained tertiary education are consistently negative and highly significant, i.e., females and highly educated are significantly less likely to vote for populist parties. Self reporting insufficient income or income difficulties are significant sporadically but, in general, consistent with economic explanations of populism: self reporting having sufficient income is negatively correlated with voting for populist parties while reporting income difficulties is positively associated with voting for populist parties.

Effect of the European crises

Europe experienced the global financial crisis in 2008-9 and the Southern part of the Eurozone experienced another severe recession in 2012. Did the crises change the effect of associations on voting pattern?

Columns 2 and 3 in Tables 1 and 2 report the results when we split the samples between 2002-10, and 2012-16. These two sub periods are chosen also in light of the retrospective nature of the question on individuals votes. Columns 4-11 show the results for specific years. The coefficient on civil association membership is negative and statistically significant for every year (with the exception of 2004 for OLS in Table 1) but becomes even more negative after the global financial crisis. Note also that the coefficient of the variable for (self reported) insufficient income is negative and significant after the global Enancial crisis; and its magnitude increased 2-3 times in the post ctisis period.

What can explain the increasing negative correlation between civil association membership and populist vote? One potential explanation is that before the crisis party discipline was strong, and ideological vote was important. Post crisis, notably with the collapse of social democratic parties across Europe, individual beliefs became unhinged. With more unhinged beliefs, people felt more open to vote for new parties. Civil associations, on the other hand, provided ideological anchors and voice mechanisms alternative to voting for outsiders. Therefore, individuals who belonged to these associations voted less for populist parties.

This explanation is also consistent with the view that social capital represented by civil associations membership has a long term effect which manifests itself in moment of crises. Another complementary explanation is that economic crises have a big role in the system of beliefs on the role of the state. People, mostly young ones, demand more from the state but, at the same time, are more sceptical about the state. This unanswered demand is fulfilled by civil society associations and less by populist voting. Last but not least, the crisis had an impact on the supply of populist parties, making the vote more responsive to civil association membership.

Extended specification correcting for potential sample selection bias

OLS and Probit regressions have the potential problem of self selection given voters may decide not to vote. Indeed, individuals make two decisions: (1) whether to vote in an election, and (2) conditional on voting, which party to vote for, whether to vote for a populist party or not. This issue has been recognized in the literature, e.g. in Guiso et. al. 2017, and has been addressed through a two step Heckman model, to account for the bias that may result from the fact that party choice apply only to voters who turnout to vote.

Following the literature, we estimate a two step Heckman model. In the first stage, we estimate the probability of participation. In the second stage, we estimate the probability of voting for a populist party. For identification, we need to introduce at least one variable which affects the probability of voting but does not have a direct effect on the choice of party. As instrument we use proxies for lack of awareness about public choice issues.

We assume that lack of awareness affects voter turnout by increasing the cost of acquiring information about political platforms and candidates but does not directly impact choice of political party. We use several proxies for lack of awareness. The proxies are measured by the number of “don’t know” or “no answer” to questions relating to “anything about politics”: (i) TV watching, news/politics/current affairs on average weekday, (ii) how interested in politics, (iii) able to take active role in political group, (iv) confident in own ability to participate in politics, (v) easy to take part in politics, (vi) placement on left-right scale, (vii) state of education in country nowadays, (viii) state of health services in country nowadays.

Table 3 shows the results from estimating Equation (1) by the 2 step Heckman model respectively. Table 3a reports the estimates from the second stage of Heckman, while Table 3b reports the first stage estimates. The first stage reported in Table 3b shows the coefficient on our proxies for lack of awareness is strongly negative and statistically significant. We find strong evidence that individuals who are less aware are less likely to participate in elections, suggesting that lack of awareness is a strong instrument. Overall, the results from estimating the 2 step Heckman model support the main finding in Tables 1 and 2, and establish more conclusively that populism is negatively associated with civil society membership in Europe. Women, high income, highly educated, and older individuals, are less likely to vote for populist parties. The evidence is consistent with the hypothesis that voting for populist parties is less likely among people who are likely to be more economically secure.

The rest of the findings are broadly consistent with the literature. Income affects participation positively. High income individuals are more likely to vote, but less likely to vote populist; Low income individuals are less likely to participate, but have an insignificant effect on voting populist, relative to other individuals.

Controlling for other variables, women participate as much as men but, conditional on voting, they are less likely to vote for populist parties. The coefficient on women is consistently (and significantly) negative. The negative relationship between women and far right populist parties in Europe has been long noted. In the past, authors have argued that women may be discouraged by the fact that far right European parties have conservative values on civil rights, which may be not appealing to many women. More recently, Mudde (2007) has proposed an alternative explanation: women tend to vote for conservative parties but dislike extremist parties that are stigmatized as outsiders.

Age affects participation positively, bug conditional on voting, it has an opposite effect on populist vote. Education is considered in the literature to be a proxy for the ability to gauge long term costs of current policies and is hypothesized to be negatively associated with populist vote. Our results support the significance of education; however, we find interesting variation across different categories of education. Individuals with tertiary education are more likely to participate in elections, but significantly less likely to vote for populist parties. Individuals with secondary education are also more likely to participate in elections relative to those who are not, but they are not significantly less likely to vote populist, unlike the tertiary educated. Therefore, while our results support the importance of education in determining populist voting patterns, we find that it is only the highly educated who are less likely to vote for populist parties.

Robustness tests

In this section, we conduct robustness checks to analyse whether the coefficient on membership in civil associations is robust to alternative specifications, explanatory variables, and instruments. Table 4 presents the first set of robustness tests. Panel A estimates a logit specification. Panel B includes only a subset of selection variables for the first stage equation in the Heckman procedure. In particular, it excludes (i) TV watching, news/politics/current affairs on average weekday, (ii) how interested in politics, (iii) able to take active role in political group, from the set of selection variables listed above, in order to explore whether the results are driven by these variables.

Another potential concern relates to omitted variables that could co-determine jointly the voting behaviour in favour of populist parties and the decision to join an association. Panels C and D include a number of additional controls proposed in Guiso et. al. (2017.) These include indicators for risk aversion, trust in parties and institutions, watching television, watching politics news and programs, the unemployment spell over the last 5 years, exposure to globalization, preference for lower immigration, perception of negative effect of immigrants, and right wing ideology.

The main finding that membership of civil associations is negatively associated with voting for populist parties remains remarkably robust to different specifications, smaller set of selection variables, as well as additional controls. We do not introduce additional controls in the main specifications in Tables 1-3 to avoid issues of multicollinearity between the controls, and the Heckman 2 step estimates do not converge with the large set of additional controls.

Including Trade Unions Membership

Trade unions are a form of association and have traditionally played a big role in Europe, Do trade unions play the same role as other associations in diminishing the propensity for populist votes?

In our dataset, the average trade union and association membership rates in the sample are similar, at 27 percent and 22 percent respectively (Table A4). But the trends in the two variables are also quite different. As shown in Figure 1, while trade union membership rates show a steady decline since 2002, membership of civil society associations, on average, remained relatively stable.

As a first pass, we do replicate the specification of Table 1 (OLS), Table 2 (Probit), and Table 3 (Heckman) but changing the definition of the key variable of interest. In Table 5 Panel A it is belonging to a civil association or to a trade union. The results are not as strong as in the regressions using only membership in civil society as explanatory variable (as in Tables 1 through 4). The OLS results are significant only after the crisis; the results with Probit and Heckman are more consistent across the time periods.

One possible concern is reverse causality or omitted variables. Given that membership in trade unions is more likely to be endogenous than civil society membership at these frequencies, we use an instrumental variables strategy specifically to address this concern. We use as an instrument the sectoral trade union density in another country for the same sector in which the ESS individual works. We choose the United Kingdom, because it is a country where there is no extended coverage of bargaining (or where “excess coverage” is low), and therefore trade union membership rates are an appropriate measure of the strength of collective workers’ organizations. We assume that the sectoral trade union membership rates in the United Kingdom are exogenous to populist votes in other countries in our sample, which we believe is a reasonable assumption. To implement this strategy, we drop the United Kingdom from our regressions. The results are shown in Panel B in Table 5. The estimated coefficients on association or trade union membership remain negative and statistically significant in the instrumental variable estimations.

Focusing on trade union membership

In order to focus exclusively on the role of the trade unions, we replicate the same specification with only membership in trade union as explanatory variable (Table 6.) The results show that membership in trade unions has little significant effect on the propensity to vote for populist parties except in the 2014 wave. This confirms that trade unions, despite being a form of association, are quite different from other associations. This is also confirmed from a historical point of view. In Argentina, trade unions played a big role during the Peron period in consolidating a populist regime. Instead of being a barrier to populism, trade unions did in fact become a transmission belt of populism.

Role of the Trade Unions vs. Civil Associations

Membership in trade unions and membership in associations are likely to be correlated. Indeed, the correlation coefficient between the two variables in our sample is positive and significant (0.25 and significant at 1 percent level). To disentangle the effects of these two variables we run our basic specification using the two variables (membership in trade unions and membership in civil associations.) The results are reported in Table 7, which follows the same structure as Table 6. The results show that membership in civil associations drives the results while membership in trade unions becomes insignificant in most of the cases.

Are the results sensitive to the exclusion of any speciiic country?

To test the results from any specific country we replicate the Heckman specifications excluding one country at the time. The coefficients on associations are reported in Table 8. All coefficients remain highly significant in every year and excluding one country at the time.

We also run regressions on a subset of countries that are present in all waves of the survey. Our key results are, once more, unaffected?

Are the effects of association membership heterogeneous? Age and education

In this sub section, we analyse if the negative association between populist vote and association membership is driven by particular groups of individuals. Specifically, we analyse whether the effects are different across different age and education groups. We estimate the relationship between populist vote and civil association membership separately for three different age groups young, middle aged, and old. The results shown in Panel A of Table 9 show that populism and civil association membership do not depend on any specific age group. The negative correlation between populism and belonging to civil association, however, weakens in 2016 among the young, possibly indicating the importance of new social media, as collective voice mechanisms, for younger generations.

Panel A of Table 9 shows the results for three different education groups, less than secondary (i.e. less than 12 years of schooling), secondary to tertiary (between 12 and 16 years of schooling), and greater than tertiary (more than 16 years of schooling). Again, the negative correlation between belonging to civil association and populism is not driven by any education group.

Evidence from Latin American voting data

Next, we show results on drivers of voting for populism for Latin America, the continent with the longest history of populist parties in power. Another reason to analyse the Latin American case is that in these countries voting is compulsory (see Figure 2), making the issue of sample selection into voting less relevant than in Europe.

As noted above, the data for Latin America has very limited coverage, with much fewer observations compared to Europe. In addition, the data covers only the period from 1996 to 2008, with many gaps. Therefore, we cannot evaluate how the association between trade union membership and populist vote changed since the global fiscal crisis. Therefore, these results should be interpreted as being only suggestive, and should be taken with caution.

Table 9 presents the probit estimates of the drivers of populism for Latin America. The specification is identical to that for Europe. All regressions include indicators of income, age, gender, and education, and control for country time fixed effects. All standard errors are clustered at the country level.

The results, however, are qualitatively similar to what we found for Europe. Populist vote and trade union membership go hand in hand in the earlier part of the sample, but move in opposite direction since 2007. The estimated coefficient on trade union membership is positive and statistically significant for the sample period from 1996-2005, but turn negative and significant during 2007-2008. In other words, we observe qualitatively similar patterns between Europe and Latin America, albeit with different samples and databases.

Note that under the Latin American voting dataset we do not perform the robustness test by replacing the logit and probit models with the Heckman specification due to lack of data on instruments.

6. Populists in Power. See the full report (download link below).

7. Conclusions

Researchers have focused on the many reasons behind populism, including cultural backlash, economic uncertainty, and lack of trust. But no previous study has focused on the role of civil society. Civil society has long been recognized as a key defence of liberal democracy, as Alexis de Tocqueville wrote almost two centuries ago. At the same time, populists, who do not see a role for civil society, may pragmatically use associations as transmission belts, as the historical experience in Latin America may indicate. Thus, one can find arguments for civil society being a protective shield against populism or a vehicle of the populist ideology and the role of civil society in the rise of populism is an empirical matter. However, empirical tests have been lacking. This paper fills this gap.

This paper is innovative also because it encompasses both Europe and Latin America, in contrast from previous studies. This is important because Latin America has a longstanding experience with populist parties in power, and the literature in political science has recognized that all populisms have important traits in common despite the obvious differences due to the different geographical areas and right or left orientation. Our results show remarkable similarities in Latin America and Europe, an indication that the issue highlighted in the paper is important in understanding populism in general. This paper has also shown that unions in Europe (different from other associations) have a weak negative association with populism.

Finally, this paper also sheds new light on the role of the global financial crisis in the political process. The global financial crisis has not simply caused a populist wave. Rather, it may have changed (and enhanced) the role of civil society. In a world where political systems, institutions, and ideologies have been put into question and even discredited, where social democracy in Europe almost disappeared, civil society assumes a new role.

But this paper also opens important questions for future research.

First, why the role of civil associations as a vaccine against the populist vote was less important before the global financial crisis?

Second, what are the specific mechanisms through which belonging to a civil association lowers the populist vote? Is it because associations provide alternative information or because they offer an ideological anchor? Is it because they promote social responsibility beyond onesself? Is it because they offer voice mechanisms alternative to exit-punishment of incumbents? Is it because civil society associations are identity providers moderating the impact of migration on the identity of local communities?

Third, are all associations equivalent or are some associations more effective?

Fourth, do associations have a similar impact on all members of society or is belonging to an association more relevant for some groups?

Future research, possibly benefitting from data also covering the refugee crisis, should further investigate these issues.

Download the full report here (pdf) Populism and Civil Society

IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.