06 Jan 2017 20:14 IST

A year when ‘populism’ won

It is yet unclear what the ‘post-truth’ world has in store for us

For many, the year 2016, which came to an end last week, was a forgettable one. Apart from the passing of many popular personalities (some before their time), at the political and economic level too, the year marked a definitive change from the past.

The three major events that unfolded last year — at the global and domestic level — were Britain’s exit from the European Union (Brexit), Donald Trump’s surprise victory in the US elections and, closer home, Prime Minister Narendra Modi’s ‘surgical strike’ on black money, or ‘demonetisation’. It was also the year where politics took a decisive shift towards ‘populism’ which, for some, took a worrying ‘Right’ turn.

Each of these events symbolised a decisive shift from the past. Brexit marked the end of another chapter of globalisation, at least the way we had come to understand this term in the last two-three decades. Cutting down tariffs to enable freer movement of goods across borders, and easing curbs on financial flows for movement of capital were two key elements of the globalisation agenda.

Pick and choose

Right from the early 1980s, western governments and multilateral agencies (IMF/World Bank) have been vocal in urging other countries, especially those in the developing world, to tweak rules to allow more foreign investments — both the physical and portfolio forms. The collapse of the Soviet Union and the Eastern Bloc gave a further boost to globalisation that eventually led to the formation of the World Trade Organisation in the early 1990s.

But here again western governments were careful in arguing for free movement of goods and capital and not people (especially low-skilled workers), for which barriers are still firmly in place. These governments were keen on only attracting skilled labour suited to their economies.

Though there has always been an undercurrent of dissent against this form of globalisation — as witnessed during the protests and riots in the Seattle ministerial meeting of WTO in late 1999 — they were still only peripheral and hardly disturbed the existing consensus.

Some cracks started appearing after the 2008 financial meltdown, especially after the Occupy Wall Street movement, which highlighted Wall Street greed and inequality, but it was Brexit that was really the first firm vote against globalisation in the political arena. That the results of this referendum came as a huge surprise to most people across the world was a clear indication of how out of touch the ruling establishment and the media were with the ground reality.

Trump victory

The major event that struck a bigger blow to the prevailing economic and political consensus was Donald Trump’s victory at the US elections. Those who thought that Hillary Clinton’s victory was a foregone conclusion could not believe their eyes when the results started coming in. Trump’s obnoxious comments on race and women didn’t seem to make the least bit of difference to the voters; in fact, in a perverse way, they even burnished his image among his supporters.

The Guardian correspondent Dan Roberts, while covering the election campaign, came across a retired carpenter who summed it up: “I think Trump is nuts but I’d like to have him as President to see what happens.” And the irony is that this man voted for Barack Obama in the last two elections! Seen as a revolt against the establishment, a vote for Trump was also a vote against the ‘technocrat’, a vote against the ‘expert’.

Closer home, Prime Minister Narendra Modi’s November 8 announcement withdrawing ₹500 and ₹1000 notes with immediate effect, which sucked out 86 per cent of currency notes in circulation, was the next tectonic shift, not only in the economy but also in politics. There is little doubt that the decision was shrouded in secrecy, and the implementation was completely botched up. The disruption caused to the lives of many millions in the country following this decision is very real. But this was a decision that had the Modi stamp all over it.

As one senior journalist with close connections to the Sangh Parivar blithely remarked in a newspaper interview if Modi had consulted the experts on demonetisation, they would have dissuaded him from it.

Demonetisation and after

But despite the pain and disruption, this decision only seems to have enhanced Modi’s image as a crusader against corruption and black money. Media reports suggest that the people who are worst hit by demonetisation are the ones who seem to be supporting him the most. As social scientist Shiv Visvanathan said in a recent column, “They wait patiently at ATMs without criticising the government as an act of patriotism”.

So, whether demonetisation has made a serious dent in the stock of existing black money and whether it will prevent generation of black money in future are questions that economists will split hairs over when the data start coming in. But, for the moment, Modi seems like a messiah in his crusade against corruption. Of course, it will be interesting to see how much of an impact this issue has in the upcoming Assembly elections, especially in Uttar Pradesh.

So we are at a juncture where old truths and consensuses are fast collapsing, but no one yet knows what will replace them.

Recommended for you