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Economic Policies and Identity Politics

Conventional wisdom holds that today’s angry populism will wane if income is distributed more fairly. But unless we address the identity clash on which populism thrives, politics will become so nasty that spurring innovation, reducing income inequality, improving public services, and fighting climate change could become impossible.

LONDON – What kinds of economic policies should centrist reformers pursue? The standard answer is that they should target innovation-driven economic growth and a fair distribution of income. Achieving these goals simultaneously would be difficult under normal circumstances. Nowadays, the clash of identities threatening to tear apart many democratic societies makes it even harder.

According to conventional wisdom, a fairer distribution of income is the best way to defang identity politics. In fact, the opposite is true: unless we address the identity clash head-on, politics will become so nasty and intractable that spurring innovation and reducing economic inequality, let alone improving public services and curbing climate change, could become impossible.

Part of the answer is candidate choice: elitist, aloof leaders will be perceived that way by voters. Policies also can play a role, but not just any policies. The key is to transmit one fundamental message to voters: government is working for you, not for elites of some kind or for friends in the party establishment.