by Pranab Bardhan
As the job-displacing effects of markets and global integration and the cultural shocks of large immigration have rattled workers, particularly the less skilled ones, their reactive turn to populism in different parts of the world has dismayed liberals. This has been reinforced by resentment against centralized bureaucracies (not just in Brussels or Washington but also in Mexico City or Delhi or Jakarta) run by professionals and technical experts whose dispensations often ignore local realities and sensibilities. The alliance between liberals and workers that used to form the backbone of centrist democratic parties is getting frayed, as in the minds of many blue-collar workers the liberals with their mobile professional skills come across as privileged meritocrats and rootless cosmopolitans (‘citizens of nowhere’).
Global markets and mobility of capital have required standardization and harmonization of local rules and regulations, which some communities feel are ironing out their local distinctiveness and proximity-based personalized networks. Increasing market concentration in large corporate firms, their blocking of small business, capturing of state power in democracies through strong lobbies and copious election funding, and weakening of labor organizations and depressing labor share have made many small people precarious in their livelihood and suspicious of markets.
State-provided public services which are supposed to relieve the harshness of the market are everywhere riddled with bureaucratic indifference, malfeasance, and resistance to reform, while the better-off liberals are increasingly seceding from them. In developing countries the public delivery of social services is often so dismal (with inept, corrupt or truant official providers) that in contrast the image of voluntary community organizations (including charitable religious institutions run by Muslim, Hindu or Christian evangelicals) trying to fill in the gap is often much better than that of the state. Even when the state delivery mechanisms work reasonably well, the projects often do not involve the people but simply treat them as passive objects of the development process. (In rich countries communities have sometimes rejected negotiations over their heads by corporate and city officials to help investment in the community—as in the recent case of the failed Amazon investment proposal for Queens in New York). Read more »