Read: August 2022
Inspiration: Came across on Amazon’s bestseller list; wanted to understand what “populism” meant
Written with the help of ChatGPT, below is a brief summary to understand what is covered in the book.
“The Economics of Discontent: From Failing Elites to the Rise of Populism”, published in 2019 by author, professor, and entrepreneur Jean-Michel Paul, examines the economic and political factors that have contributed to the rise of populism in recent years. The book discusses how economic inequality, globalization, and the decline of traditional industries have contributed to a sense of discontent and frustration among many people. It also explores the ways in which these factors have fueled the rise of populist movements, which have sought to challenge the status quo and the established political elites. Paul argues that the economic and political challenges facing many countries today are complex and multifaceted, and that addressing them will require a nuanced and thoughtful approach. The book ultimately makes a compelling case for the need to find new ways to address the root causes of discontent and to build a more inclusive and prosperous society.
Direct from my original book log, below are my unedited notes (abbreviations and misspellings included) to show how I take notes as I read.
The rise of populism stems from detached elite class who are out of touch with growing inequality and declining mobility, dissenters now see they are the majority, need to rework policy and social contract towards fairness/win-win, in france and italy extreme right and left came together really as middle finger to elite vs any unified policy, rising cost of education/rent/health have disproportionately crushed middle/lower class (disincentivize children, add debt which burdens future income), wage growth stall while productivity and gdp expands—due to automatic, globalization, deunionization, lack of estate tax troublesome for wealth concentration—could tax less if have more children (to encourage children and less per child, children can marry outside of fam), wealthy also buy real estate that sits unused by raises costs for others, negative cycle in RE of overlending and artificially restricted supply with wealthy buyers not occupying units (poor for local economy), borrowers always need to max credit to afford, education debt burden cause Great Delay amongst Gen Z (delay to move out, start family, etc.), 30% may default on student debt which gvt bears, immigrants tend to be a net drag to collective but supported by wealthy as cheap labor and make high skilled appear more rare (increase the divide of talent), Eurozone struggles from poor transfer mechanisms for rich to poor which spawns populist movements out of frustration in poorer regions (vs US has auto stabs throughout to balance states that may be hurting), finance in reality is now the business of making money out of money (instead of actual products/services), excessive financialization of the economy at expense of growth, taxation should be minimally disruptive, can tax luxury goods higher than necessities, tax inherited/undeserved wealth more, tax in US more common via income and hurt low income—social security tax common lever but backwards vs taxing luxury/real estate/inheritance, increase to labor tax simply drive more to unemp/shadow, fiscal policy been driven to useless level as debt so high and cuts to infrastructure and edu easiest but dumb vs say increase pension age—no more room to manuever as needed so monpol only option, lower interest rates fuel real estate bubble as bid up and QE inflate as well assets purchase for wealthy as owners of those assets, fiscal policy, QE is buying of gvt and corp bonds to push money into financial system until liquidity/confidence restored (inflates asset values too), massive QE not drive inflation as benefits to wealthy who hoard and drive inequality but not consume—wealthy helped by asset inflation but lowest propensity to consume, QE lead to “generation rent” owners benefit but young struggle to afford, cap real estate lending in favor of more productive assets—reduce supply constraints/hoops to jump, tax uninhabited RE highly, need to increase supply of doctors, high prices for drugs justified via R&D but in fact marketing spend is double R&D budget, need stricter laws on monopolies acquiring startups/adjacent businesses, need to cap political funding/ban foreign money, ban books deal/conferences promises, pay politicians more to get best talent, reduce people’s income tax and tax consumptions instead to start (carefully though so impact biggest spenders), tax idle wealth much more—encourage philanthropy at estate transfer, QE works as one-time policy but not 10 years, need MonPol to go back to obscurity/not only game in town, QE profits (i.e. assets on gvt BS) can be nationalized via sovereign fund locked box to invest and clean BS picture for gvt—help restore power of fiscal policy