Donald Trump is not an accident. His rise to power has occurred at a time of profound global economic and political change, when the very nature of capitalism itself is in flux and the spread of democracy around the world is undergoing a dangerous reversal. This context is vital to understanding how a man who has made fun of people with disabilities, and called women fat and immigrants rapists, might still be elected President of the most powerful nation on earth.
Given the current mood of anti-globalisation, it is easy to forget that within the last few decades industrial capitalism has brought about one of the greatest achievements in human history. Globalisation has allowed many developing countries, chiefly China and India, to integrate into the world economy as never before. In the last half century more than a billion people have escaped poverty due to economic growth in China and India alone. This is the fastest reduction in poverty in human history. While vast gaps in wealth persist between countries, the successes of China and India demonstrate that industrial capitalism, allied to a more equitable distribution of the fruits of economic growth, offers a viable route to a more equitable world.
Capitalism’s unprecedented success, however, has been accompanied by equally spectacular failure. Just as the benefits of capitalism have begun to spread more evenly around the world, a new form of capitalism, financial capitalism, has emerged. Unlike industrial capitalism which is based on trade in goods and services, financial capitalism is based primarily on making money from money. In the last few decades, the global financial economy has mushroomed to far outweigh the total value of the real economy. On the eve of the Great Financial Crisis in 2008, the daily volume of financial currency transactions had risen to almost one hundred times the daily volume of trade. The global market for financial derivatives had risen to more than ten times the gross national product of all the countries in the world combined.
The effects of the change in the nature of capitalism have been catastrophic. Financial capitalism has contributed to an explosion in inequality of incomes and the growth of a tiny elite, widely referred to as the 1%, to whom most of the profits from financial capitalism have accrued. And in the 2008 Financial Crisis, Western bankers, with the active assistance of politicians, bankrupted much of the financial system and left little option but for governments to bail them out. The ensuing crisis has lead to misery for millions of people who lost their jobs, faced reductions in incomes, or were left with debts that they could not hope to repay. And as unemployment and home repossessions spiralled upwards, the men at the helm of the major financial institutions responsible for the crisis were allowed to pocket their fortunes and walk away. The groundswell of public anger which this created is a major factor in Trump’s rise.
To make matters worse, economic disaster has been accompanied by a global political crisis. The steady advance of democracy around the world, which had been taking place since World War Two and culminated in the Fall of the Berlin Wall in 1989, has gone into reverse. Between 2000 and 2015 democracy broke down in twenty seven countries, among them the pivotal countries of Russia and Turkey. The brutal responses of dictators across the Middle East and North Africa to the popular uprisings of the Arab Spring further reinforced this authoritarian revival. The persistence of tyranny in the Arab world has crushed the hopes of millions across the region for peaceful change, and fuelled an escalation of the sectarian war within Islam between Sunni and Shia. It also led directly to the brutal wars in Syria and Libya. The resulting flood of refugees into Europe, alongside the targeting of European civilians by Islamic State, has provided a conducive environment for xenophobia and anti-Muslim rhetoric. In this atmosphere, Trump’s campaign strategy of stoking widespread public fear while posing as a strongman protector against dangerous alien forces is proving to be a formidable strategy.
Trump’s rise to power can be seen therefore as less an accident than as the skilful manipulation of popular discontent at powerful global forces and the inability of existing political elites to provide American citizens with the security and prosperity they demand. Tragically, but predictably, a Trump Presidency would serve only to further increase American’s sense of insecurity and economic vulnerability, as well as posing a fundamental threat to the current world order.