Updated Take on the 2016 Election

By a narrow margin, Americans elected Donald Trump as president in 2016.  He represented a rejection of the economic status quo, and an endorsement of the old cultural status quo.  In other words, he was and is a populist Republican.

It is widely recognized that the most popular national American politician today (mid-2017) is Bernie Sanders, a populist Democrat.

To many it seems that the social fabric is disintegrating.  One of the main remaining planks of bi-partisan consensus is the need for fiscal responsibility -- i.e. balancing the budget over the long run.  Yet, as I have argued extensively elsewhere, this is an idea that needs to go.  Which populist faction will move forward by severing this thread of our remaining bipartisan consensus?

There has been extensive talk by the Republicans of moving forward with this, and it could catch the Democrats off guard.  Suppose Republicans pivoted on middle class tax cuts (e.g. payroll tax), Medicare-For-All, or some other such populist measure that would greatly improve life for the middle class.  Would Democrats oppose this on the grounds that the Republicans were violating an (yet another) unwritten rule of the bi-partisan consensus?

In addition to arguing against the desirability of fiscal prudence as conventional construed, I have repeatedly argued, and continue to believe, that a financial crash is in our near future.  If and when this happens, the populist pressure will soar.  Democrats should get in front of this and embrace economic populism sooner rather than later.  The cultural wars that Hillary's faction led will be reduced in significance.

The recent Democratic defeat in the suburbs of Atlanta is also relevant.  In this election, the Dems poured big money into the cultural (anti-Trump who is characterized as racist, misogynist, etc) as opposed to economic issues, but weren't successful.  This was a relatively prosperous suburb, and even the Dems were unsuccessful in winning by appealing to cultural and economic prudence.

I could be wrong.  The economy may continue to muddle along; people may tire of Sanders' economic populism; cautious centrism may become popular again with a youthful face such as Emmanuel Macron or Kamala Harris.  Stay tuned.

UPDATE:  The same day as I wrote this, Kate Aronoff published a similar take:  Don’t Fly Like a GA-06.  Excerpt:

One of Ossoff’s more well-circulated ads (entitled “Table”) found him sitting alone at a kitchen table, aping a line from Margaret Thatcher to bemoan how “both parties in Congress waste a lot of your money.” In the folksy imagery and call to reduce the deficit, he invoked a trope that’s been circulated for years by pollster Frank Luntz and other right-wing goons to justify painful spending cuts: if hard-working American families have to make tough choices about their finances, then why doesn’t Washington?

The line — as several economists have pointed out — is nonsense. Households do not have the power to set interest rates and print money; the US government does. But from a political perspective, the logic is even more troublingly misguided. That “fiscal responsibility” is a popular, common-sense stance widespread among voters is a prevailing myth of neoliberal economics, and one now embraced across party lines.

It also has no discernible base of support with actual voters. Beating the GOP will mean taking that message to heart, and giving voters a bold vision to support rather than status quo austerity politics and a madman to revile.