Then there is the rise of Donald Trump. This was to be the year when a small cohort of billionaires expected to put their stamp on the Republican nomination and a candidate of their choosing into the White House. But from the moment Donald Trump descended down the escalator at Trump Tower to face the waiting media and announce his candidacy, it became apparent that this year was not going to go according to plan.
Many of those economic resentments are well-founded. Over the past four decades, the economy of the world has been transformed by United States economic policies supporting globalization and free trade that have produced growth in real incomes for hundreds of millions of people across the world. While the opening up of the world economy has greatly benefitted the wealthiest Americans--with technology and finance now the leading paths to great wealth, according to Forbes--the middle class Americans have not fared so well, as real wages have remain stagnant for the better part of four decades.
From the perspective of many Americans, the economic system is rigged. Globalization has pitted American workers in a wage competition death match with lower paid workers across the world. New technologies that seemingly offered the prospect of increasing labor productivity and wages have instead proven to exacerbate the problem in many industries. Instead of increasing wages, in a globally competitive labor environment where capital is mobile and abundant, productivity growth instead enhances the return on capital, further exacerbating the concentration of income and wealth.
However one describes the economic conditions that have given rise to the hoards flocking to Donald Trump and Bernie Sanders rallies--Republicans tend to describe the problem as wage stagnation while Democrats prefer to frame it as income inequality--the underlying data suggests a quandary that should concern all Americans. One does not have to believe a word that Donald Trump says to appreciate the importance of the issues that have led to his rise. The thousands upon thousands of people who regularly show up at Trump rallies have focused attention on long-standing economic policies that have enriched the few while undermining the stability of American families and their faith in the future.
There are no easy solutions to the problem that we now face of an economy that is no longer serving the interests of a large share of the American population, and certainly Donald Trump has not offered any. But as Donald Trump suggested in his foreign policy speech last week, every other nation designs its economic and trade policies with the welfare of their citizens first and foremost in their minds, and he is arguing that it is time that the United States does the same. The argument that American support for free trade and globalization has uplifted real incomes for billions across the globe, and that therefore the policies have been successful--they have produced the greatest good for the greatest number--is running up against the reality that only American citizens vote in American elections. Set aside for the moment the empathy gap evidenced by Andreessen's words, the practical reality is that democracy means that a disaffected popular majority can upend the status quo, even if they don't have a better solution in mind.