From the Editors
This edition of the Political Economist highlights new research on the state’s role in the economy. Hübscher and Sattler consider the political consequences of austerity, while Wu and Feierherd write on labor market risks and politics.
These three essays—and the academic work that underlies them—stand on their own, each contributing a novel insight to areas of longstanding interest in the political economy literature. But their shared focus on the shifting relationship between states and citizen resonates with contemporary politics in striking ways.
Governments around the world have over the past year embraced regulatory, fiscal and monetary tools to soften COVID’s labor market and macroeconomic consequences. In the United States in particular, the political space for redistribution and deficit spending, and a heavier hand in the labor market have gained political purchase. This disruption parallel’s COVID’s impact on the international political order, as discussed in essays highlighted in the 2020 Fall edition of the Political Economist.
The scale and durability of this shift remains unclear, but it is easy to imagine the government’s COVID response may end up defining and reshaping state-society relations for years to come. The highlighted works consider the pre-COVID state of affairs in particularly interesting ways, and in doing so captures important aspects of the tensions in governance that COVID-era policymakers inherited.
Wu considers the political consequences of automation in the labor market. Her novel experimental design shows not only that American workers are anxious about automation, but that this anxiety emerges not as resistance to automation, but, rather, to globalization. Automation anxiety intensifies protectionist sentiments and out-group discrimination but does not diminish Americans’ positive appraisal of technology. Wu notes that further automation’s likely inevitability means that means that the political task at hand is to manage its economic and, especially, political consequences.
Wu’s essay hints at political dynamics that are likely to intensify. By all accounts, preexisting trends towards automation are accelerating, as businesses incorporate technologies developed during the pandemic (think: QR codes in restaurants) and manage the implications of currently upwards trending wages. But an American luddism seems unlikely. Americans are not getting angry at labor saving technology per se. Rather, the displacement of American labor through automation is likely to manifest in political resistance to immigration and free trade. And with government doing more to define itself as a steward of labor market conditions, the pressure this reaction will bring to American politics is surely to remain salient.
The consequences of newly more activist states are similarly clear in an emerging popular resistance to austerity politics. Indeed, one of the defining features of COVID politics thus far is the extent to which some government seemed to have “learned”—or relearned—from the experience of 2008 and austerity’s capacity to deliver economic and social instability.
Hübscher and Sattler detail (again, in a pre-COVID context) austerity’s consequences to the fabric of political contestation. Hübscher and Sattler suggest that austerity politics can contribute to party system change and, ultimately, to political polarization and increased support for populist parties. Their experiments show European voters’ generally critical views of austerity, particularly with respect to public pensions, health care and education. These attitudes can change party systems by leading voters away from mainstream parties converging on fiscal policy adjustment. Beyond ideology and partisan attachments, Hübscher and Sattler show that economically vulnerable voters react to threats to the social protection by embracing populism. This is an especially thorny area for research, and Hübscher and Sattler end their essay discussing alternative ways to capture voters’ preferences, and how external interventions or different regional context are needed to understand the global consequences of austerity. Overall, the work described by Hübscher and Sattler provides a much-needed picture of austerity politics as it existed in the immediate run up to COVID, and of the likely consequences when fiscal constraints and austerity will return.
Our final essay, from German Feierherd, considers Latin American labor market politics. Feierherd’s essay focuses on leftist parties’ superficially puzzling habit of weakening the enforcement of labor contracts. As Feierherd shows, Latin American left parties face an “intra-class dilemma” of conflicting interests between workers employed in the formal versus the informal sector. More rigid enforcement of labor law protects formal sector workers from their employers, but often undermines informal laborers’ access to employment. Feierherd argues that these parties’ reliance on informal workers’ votes lead them to embrace forbearance, intentionally slackening the enforcement of labor contracts and improving the welfare in the informal sector. The evidence from local politics in Brazil and Argentina supports the argument that politicians reduce enforcement such as the frequency of labor inspections of firms employing informal labor and extend benefits to cooperative workers.
Feierherd’s essay presents a stark contrast to a more commonly held vision of left parties serving labor interests by more rigorously enforcing labor contracts and bringing the state to bear on labor relations more generally. It is a welcome reminder that labor markets differ, and that any COVID-related shifts in state’s role in them will differ as well.
In this issue of the Newsletter we take a page from our colleagues running the Comparative Politics Newsletter by introducing a Q&A section with scholars who have recently won an award from the section. For this issue we have interviews with:
- Guadalupe Tunon (Mancur Olson Best Dissertation Award);
- Danny Choi, Andrew Harris, and Fiona Shen-Bayh (McGillivray Best Paper Award);
- Francisco Garfias (Co-Winner of the Michael Wallerstein Award);
- Dominik Hangartner, Elias Dinas, Mortz Marbach, Konstantinos Matakos, and Dimitros Xefteris (Co-Winner of the Michael Wallerstein Award); and
- Isabela Mares and Lauren Young (William H. Riker Book Award)