Business and Populism: The Political Economy of the 'Odd Couple'

This chapter describes how right-wing populism creates a distinctive set of problems for business. Populism depends on a differentiation between the establishment elites and ‘the people’. The elites have become corrupt, self-serving, and distant from the concerns of the people. Populists promise to ‘drain the swamp’ and place themselves as authentic representatives of the people. In doing so they explicitly attack business for globalizing their production and removing employment from the country whilst at the same time encouraging immigration which impacts on jobs, public services, and issues of national and cultural identity. Populists attack key non-democratic institutions developed under neo-liberal governance as ways of keeping business power out of noisy politics, e.g. independent central banks, the use of experts and the creation of network governance, lobbying processes, and ‘revolving doors’ between business and government. They attack other powerful intermediary institutions such as the judiciary, the civil service, universities, and a free press as undermining the ‘will of the people’. For business, this involves major disruption in how they influenced policy making over the neo-liberal period. However, right wing populists remain committed to capitalism, low taxes, decreasing regulation and easy credit conditions. How then should business respond to these disruptions? We identify a range of responses based on firstly the specific form of populism in particular contexts and the degree to which it energizes its voters through economic or cultural discourses and processes, and secondly on the degree to which businesses engage in exit, voice, and loyalty strategies towards populist governments.