The rise of populism has become a global obsession in the last year, driven by the major upsets in Brexit and Donald Trump’s Presidential election victory, but with echoes in many other countries throughout the world.
In particular, there is a very clear and growing sense that regular people feel they are being left behind by establishment and political elites that don’t understand or care about them. These themes come through incredibly strongly in the Global Trends survey. Firstly, it is the majority view in every single country in the study that the economy is rigged to the advantage of the rich and powerful. This is even the case in Sweden, which typically feels more at ease with itself. It is most extreme in Mexico, where 94% think the economic system is rigged, but Spain and Italy come next in the list: these two western European democracies have over 80% of their populations who think the economic system is rigged against them.
If people think the economic system is rigged against them, governments don’t fare much better, with half or more in EVERY country agreeing that their government doesn’t prioritise the concerns of people like them.
In fact, there are very similar levels of agreement and country ranking as the previous question – Mexico, Spain and Italy at or near the top, Sweden at the other end, but still, even there, over half of Swedes agree their government doesn’t care about them. The exercise of political and economic power to the advantage of the elites is effectively fused in people’s minds.
There is an interesting global pattern here. Unlike other trends in this volume, we don’t see an ‘old’ versus ‘new’ world split. There is no ‘multipolar’ view on how power is rigged against ordinary people – it’s one of the few globally unifying trends!
So how do we understand these trends and where they might go next?
In 2015 before Trump and Brexit, Mark Zuckerberg of Facebook’s first pick for his new book club was The End of Power: from Boardrooms to Battlefields and Churches to States, Why Being in Charge Isn’t What It Used to Be, by Moisés Naím. It seemed an unusual choice (not very Oprah Winfrey), but it makes perfect sense given the disruptive events now unfolding. Its hypothesis is that power is now easier to get, harder to use and easier to lose. In many ways this is a good thing. There is a lower chance of dictators and despots, as people can’t hold on to power for as long, or as deeply as they used to.
This description of less concentration of power among the few seems at odds with other ‘big idea’ books of recent years, including Thomas Piketty’s Capital in the Twenty-First Century, which outlines the incredible concentration of wealth and economic power at the top of most societies over the last 40 years.
But the two can be reconciled. Power can become less stable, more fleeting, but still be concentrated, and in some ways more dangerous. As Naím says, the loss of ‘superpowers’ of global authority could mean greater instability. The combination of these conditions – less stable control of power but growing inequality and alienation – make the darker side of Naím’s thesis, possible paralysis of power or anarchy – in effect, fragmentation – more likely or important.
So how should governments and business respond to this more dangerous context? The political context looks very unstable, with talk of a “super-cycle of disruption”. It’s hard to tell when you’re in the middle of such a cycle, and we’d be more circumspect about declaring that’s what’s happening quite yet: for example, the 2017 Dutch general election did not provide the reinforcement of a populist swing that many predicted.
But in all this, we need to bear in mind the positive potential of disruption if it gets us to a more even distribution of power. Already there has been a sea-change in politics away from ignoring or even trying to silence the economic and cultural concerns of the ‘left behinds’. This really is as much about culture as economics: we can predict a lot about people’s overall outlook and mindset simply from knowing their views on the death penalty, whether they think human rights protect the criminal rather than the victim, and whether they believe political correctness really has “gone mad”. But we’re a long way from reconciling these concerns with existing political and economic systems.
For businesses and brands, the first point to note is that consumers do not automatically group them together with the ‘elite’. Trust in business is much higher than belief in the ‘system’, as the chart opposite shows. True, the world is divided on whether business can be trusted or not – with some particularly negative views again in France and South Korea – but it’s also not the wholesale rejection seen with politics in much of the world.
This is maybe because ‘business’ is so much more varied than the economic ‘system’ in people’s minds, made up of individual companies and brands that they do connect with. Many business leaders left Davos recently with a nagging dilemma: do they maximise profits for shareholders or bend more towards people’s demands for better jobs, responsible tax behaviour and
But as The Economist points out, the options are not nearly as monolithic: “wiser executives know that shareholder value comes in shades of grey”. Corporations in the West have a range of approaches to this question, from corporate fundamentalists at one end (who only care about profit, and seldom succeed for long) through to corporate kings (who make so much money they can afford to do both). But there are steps in between, including corporate oracles, who bend in advance of anticipated changes coming from politics and the people.
The system is therefore more adaptable than it appears, and businesses should be more confident and forward-looking in their positioning. Those that are seen to be on the side of ordinary people, in small ways as much as big, as employers and contributors to society, as much as generators of profit, can thrive. Time and time again supermarkets emerge as the most trusted of all businesses – they are tangible, provide basic necessities cheaply and in their marketing communications show they are ‘on your side.’
Mark Zuckerberg was very prescient to pick out The End of Power in 2015. A lot has changed since, but the themes identified are key to understanding the shifts still to come. Ironically, the book completely sold out on Amazon within hours of Zuckerberg announcing his choice: the economic and cultural power of the elite hasn’t entirely disappeared. And, of course, many populist ‘revolts’ are led by just a different flavour of elite – not least, a billionaire in the US and a public school educated son of a stockbroker in the UK. But this doesn’t make the underlying trends any less significant, and business and government need to understand the deep-rooted anxieties they tap into.