Jonathan Rothwell - A Republic of Equals: A Manifesto for a Just Society

OUR COUNTRY IS IN SERIOUS TROUBLE, began Donald Trump as he formally announced his candidacy for president of the United States in June 2016. He listed China, Japan, and Mexico as aggressors who are beating us and killing us economically via bad trade agreements. Mexico, meanwhile, is further harming the United States through immigration, he claimed: The U.S. has become a dumping ground for everybody elses problems.

In remarks that would be much quoted and criticized, he said:

When Mexico sends its people, theyre not sending their best. Theyre not sending you. Theyre not sending you. Theyre sending people that have lots of problems, and theyre bringing those problems with us. Theyre bringing drugs. Theyre bringing crime. Theyre rapists. And some, I assume, are good people.

Trump eventually won 46 percent of the vote in the 2016 U.S. presidential election. His victory followed significant gains by nationalist parties in the European Unions 2014 parliamentary elections, and a shocking vote by the United Kingdom to leave the European Union.

The nationalists seem to have two things in common: An insistence that their countries are declining, economically and culturally, and the identification of external forces as the reasonwith trade and immigration being primary suspects. These views are badly mistaken, but the nationalists have a point about the ill-functioning of the economy, and much of the public shares their sense that something important is wrong with their countrys political leadership.

This chapter lays out what is wrong and why. Rising income inequality and slow economic growth have been two of the most striking patterns in rich countries during the last 35 years. The explanation is not trade or technological innovation; nor is it mass migration or the rise of global superstars. Rather, countries are becoming more inefficient and unequal because serviceswhich are regulated and controlled by elite associations to the benefit of their membersare taking over the economy, and a small group of elite service providers has managed to secure much of the gains for itself via the gradual accumulation of rights and privileges that elevate this group above markets.

In most of the worlds richest countries, political discontent reigns. Confidence in government is low and has fallen steadily in recent years. In 2006, 43 percent of residents living in Organisation for Economic Co-Operation and Development (OECD) member countriesthe worlds 35 richest democraciesexpressed confidence in their national government, when asked by the Gallup World Poll. By 2016, that already low share had fallen to just 37 percent of residents. Shockingly, thats lower than the global average of 54 percent.

Confidence has plummeted in a number of countries that have seen a rise in support for nationalist parties or politicians, including Greece, Finland, the United States, Denmark, the United Kingdom, and Austria ( In the United States, confidence is only slightly higher at 30 percent.

On the other hand, low or declining confidence in national government is not inevitable in rich countries. In the Netherlands, confidence increased from 43 percent to 57 percent. In Switzerland, confidence went from 63 percent to 80 percent. It is also up and relatively high in Canada and Germany. Extreme political parties have not been as successful in these countries, with the exception of Germany, where the far-right Alternative for Germany Party (AfD) has gained traction, reportedly, in response to the governing partys acceptance of a large number of refugees.