Rational Populism: a programme for JD Vance and Kemi Badenoch

In the globalising evolution of capitalism, the divide between areas of prosperity and those left behind has become stark. Advanced technologies and financial capital flow together into global centres - New York, London, Silicon Valley. Wealth accumulates, technology advances: an ecosystem forms where lives are fulfilling.

The flip side of this development is the economic abandonment of deprived regions and social groups, left to grapple with poverty, stagnation, and alienation. 

This combined and uneven development of capitalism is not an accidental byproduct but the inevitable outcome of a clustering economic efficiency.

For those left behind, however, populist discontent has been the result, often directed at the elites and the forces of globalisation. But a reactive, protectionist populism leads only to the cul-de-sac of worse deprivation.

Instead we need a rational populism - a political and economic strategy that accepts the inherently globalised nature of the modern economy while deploying targeted government initiatives to bring marginalised regions and social groups back into the fold of growth and progress as far as is possible. 

Rather than the impossible, reactionary dream of retreating from globalisation, how can we ensure that the forward march of development includes everyone? Here are some ideas.

An often-advocated policy is the government funding of new transport networks, digital infrastructure, and green energy projects not only to create jobs but also make these regions more attractive for future private investment. Reindustrialisation here doesn’t mean a return to old manufacturing models, but rather a focus on sustainable industries that align with global economic developments.

Investment should also fund regional innovation hubs to provide a base for individuals with those portable skills the leading edge of industry requires. We saw some of this ‘migration to the country’ in the COVID epidemic and it’s a trend which is real - and which can be amplified.

In some deprived regions, the existing human capital limitations diminish the pool of labour available for high-skill industries. 

While education and vocational training is always important, there is also a place for near-future government sponsorship of personal cognitive automation systems to help circumvent such employment barriers. Most likely markets will fail to sufficiently invest in these areas.

Government-supported automation in sectors like agriculture, logistics, or light manufacturing can also catalyse efficient production systems that make use of lower-skilled workers while still providing economic returns. By automating key processes, regions with historically lower human capital can still participate in the global economy, with gradual skill-building taking place alongside where possible.

A rational populism must recognize that while government stimulus is crucial in the early stages in these regions, interventions must not become perpetual. The goal is to kick-start self-maintaining economic ecosystems, moving regions and social groups from dependence on state support to active participation in the global economy.

The combined and uneven development of capitalism has left many regions and people behind, but the solution is not retreat. A rational populism must accept the globalised nature of modern economies while ensuring that left-behind regions are actively brought into the forward movement of progress. Through targeted training, infrastructure development, sophisticated worker-centric automation and government-backed enterprises, we can create the conditions for these regions to flourish within the global economy. This is not about protectionism or isolationism, but about ensuring that no one is left out of the future.

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So what kind of a point am I making in advocating rational populism here? 

• A logical point: that the programme I've outlined is in some sense the optimal conclusion of any rational analysis in political-economy?
• A moral point: that this is the true politics of universal human values? 
• A pragmatic point: that such a programme is the best way to secure social cohesion and stability? 

In fact orthodox economics would not agree with rational populism. There, the optimising metrics are things like GDP growth or GDP growth-per-head. To secure such outcomes, discretionary spend by government should maximise marginal ROI per marginal unit of expenditure. Does the government get better economic returns from an additional million pounds in London, Oxford or Cambridge - or in Bradford, Huddersfield or Penzance? Plainly ROI follows the clusters of excellence... and the Treasury will look askance at 'wasting money' elsewhere.

But the abstractions of economics hide political interests. If you belong to the elite of London, Oxford and Cambridge or their like across the world, you will naturally benefit from optimal augmentation of the wealth you already partake in: what is it to you if deprivation flourishes in the deindustrialising hinterlands?

If, however, you are part of the 'left-behind' masses - or culturally identify with them, then your values will urge you not to disregard and abandon them.

I would say that the elites, for many decades, have taken the view that their policies are optimal for 'the economy' - which happens to be optimal for their own, personal interests too: such a happy coincidence!

But those good times are over: the natives are restless. Self-interest now demands that concessions be made. I offer rational populism to those worried elites as an insurance policy: pay a little now in transfer charges for intelligent levelling up; see-off le déluge.