It should have been impossible for a boorish oaf like Trump to become US President. But he has! It should have been impossible for a boorish oaf like Boris Johnson, backed by clowns such as Nigel Farage, to have won a vote for Brexit based upon lies and idiocy, but they did. Why?
The reason can be seen by looking back at Greece. There the old way of doing things for the last thirty years, by the political centre collapsed. It was not just Pasok that no longer had any answers, but also the conservative opposition of New Democracy. That is why Syriza arose to replace Pasok, but it is also why Golden Dawn arose on the other flank. The story in Greece is not yet over. As I wrote at the time Syriza was elected, if they failed, or were forced to fail by the conservative politicians that rule the EU, the result would not be a return to the old political centre, but the descent of the country into fascism, and the further rise of Golden Dawn. But, Syriza is being forced into such a position by those conservative politicians that dominate the EU.
The same picture is being played out across Europe with the replacement of the PSOE by Podemos in Spain, and the rise of other social-democratic forces across the country, whilst on the other hand, we see the rise of extreme right-wing populist forces in the Nordic countries, in France, and in Germany itself. The reason is that the political-economy of debt that underpinned the political-centre for the last thirty years has come to the end of the road. Even the central banks know it, which is why they have been saying for months that, fiscal policy had to take up the load.
But, the politicians of the political-centre have been unwilling to adopt the kind of Keynesian, social-democratic policies of fiscal stimulus and writing down of debt that organisations like Syriza, Podemos, the Left Bloc, Jeremy Corbyn and Bernie Sanders have been proposing, because they see that as contrary to the dogma they have lived by that elections could only be won from the centre, for the last thirty years. Times have moved on, but the old Blairite/Clintonite politicians and strategists have not.
They failed to recognise what was going on, and even today cling to a few local council by-election victories by the Liberals to try to hold to the idea that that old mantra still has validity. It doesn't. Only a couple of days ago Bill Clinton came out to attack Jeremy Corbyn, the response to that has been given by the US people. Its not a response that I or any other socialist should welcome, any more than the response to that centre-ground approach presented to the british people during the EU Referendum, by Cameron, and the Blair-right Labour politicians. But, that is only similar to what happened during the 1930's, when large numbers of people who had been shafted by the system, looked for a solution to their immediate situation, and did not find it being provided by the political centre.
The politicians, pundits and strategists of the political centre have been hoist by their own petard. I have been warning about it for several years now. We have had a media that in search of ratings has been happy to trivialise every issue, and turn politics into the kind of TV "Reality" show that a demagogue like Trump, or Farage revels in. For years, the BBC and other TV channels hung on every word, and activity of Nigel Farage, and invited him into their studies to spew forth his garbage, during all that time, when his "party" represented absolutely nothing. But, the representatives of social democracy also completely failed.
On the one hand, they collapsed into conservative economic solutions, based upon the use of monetary policy to inflate asset prices, and debt in place of the need for higher wages, and an industrial strategy to promote capital accumulation and growth. They settled for dealing with the contradictions that existed, and which led to the growth of reactions racist, homophobic ideas and bigotry, not by confronting those ideas in an open political struggle, but by their normal means of bureaucratic manipulation, and action over the heads of the mass of the people. They have been left in the position after years of failing to address the political arguments with trying to fatten a pig on market day.
As I have argued for a long time, the actions of central banks in printing money to push up asset prices, to protect the fictitious wealth of the top 0.001% has not only created a grotesque division of wealth within society, that has created a backlash, but it has also led to the diversion of resources into such financial speculation, and away from real productive investment, which has meant that the deindustrialisation that cratered working-class communities under Thatcher and Reagan in the 1980's, has not been reversed, millions were left behind, and ignored by the political centre, as urban decay increased.
The economic reality will now impose itself. In the next few months, governments will be forced to expand fiscal programmes. The result will be that, the already nascent inflation will increase, as the oceans of liquidity flood out into the real economy. Higher inflation, and higher borrowing will cause market rates of interest to rise, and as interest rates rise, so those astronomically inflated asset prices on which the political-economy of the centre has based their illusion for the last thirty years, will collapse. We can expect to see stock, bond and property markets fall in over the next few months, by unprecedented amounts, just as over the last thirty years they have been inflated by unprecedented amounts.
We are living in interesting times, where as I put it some time ago, A Momentous Change is likely.
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