Anger started shopping for new narratives, and the new narratives tend to come with worse fonts.
This happened after the North Atlantic world abandoned the compact that shaped society in the decades following World War II. During that period, the region’s political economy ran on a simple premise: the free market works better when it does not look like capitalism in a hostage situation.
Governments taxed aggressively, regulated enough to keep society intact, conceded enough to labour that strikes felt therapeutic rather than existential, and built welfare states sturdy enough to give citizens a reason not to ask if the other side had better ideas.
This compact reflected the self-satisfied confidence of a system that believed it had solved history and would now like its victory lap, please, to include dental benefits, functional institutions, and John Maynard Keynes riding shotgun.
Those years were the golden era for a mindset that can be summarised as “We promise we’re reasonable.” The promise mainly held because everyone believed the alternative looked terrifying.
Communism was not simply a political rival. It was capitalism’s opposite number on the cosmic speed dial and a useful prod to the Western world’s more delicate power centres.
Politicians, technocrats, and capital owners made their peace with class compromise not because they were saints, but because they were survivalists.
The Soviet Union cast a long, chilly shadow across Europe and America, threatening elites not just with ideological defeat but with the more alarming prospect of looking irrelevant. So they built institutions that stabilised currencies, managed markets, coordinated growth, and offered late-period capitalism a non-revolutionary haircut and a vaguely humane public posture.
In the United States, the Democratic Party carried forward the legacy of the New Deal without yet getting stage fright at the phrase “tax the rich.” American labour organisations like the AFL-CIO bargained for higher wages and more benefits, and corporate America, not yet fully possessed by shareholder seafaring raiders, agreed that paying workers was less disruptive than playing chicken with ideology.
Western Europe built its welfare states through variations on the same formula: labour gets security, capital gets predictability, the state gets legitimacy, and society gets stability.
The Marshall Plan, launched in 1948 under the Economic Cooperation Administration and later overseen by the Mutual Security Agency, pumped investment into Europe while making sure markets stayed open enough to keep capital unspooked.
Meanwhile, the Bretton Woods system, formalised in 1944, kept currencies in check and governments’ interventions within bounds, without sounding like they were unlawfully borrowing from the central bank’s cookie jar.
The GATT , founded in 1947, liberalised trade ministerially, while Keynesianism liberalised politics imperially. The OECD, founded in 1961 out of the OEEC, the earlier body that ran Marshall Plan logistics, became the technocratic symposium where compromise was recorded, reinforced, and fed into the printer.
West Germany’s Basic Law enshrined liberal democracy in 1949, and the political order there coalesced quickly around the Christian Democrats’ tightrope consensus alignment with labour organisations and capital. France rebooted into the Fifth Republic in 1958 and spent the 1960s combining technocratic public administration with managed growth, suggesting moderation was not just a preference but a governing style.
The United Kingdom built its own compromise politics under Clement Attlee’s Labour government (1945-1951), resulting in the meticulous machinery of mixed-economy consensus that kept wages rising and extremes at bay until Margaret Thatcher started treating class compromise the way Silicon Valley treats antitrust law.
Christian Democrats did their best to bring moderation to Italy, though the nation’s fractured political landscape often tested whether institutional stability was constitutional or more of an improvisational art.
Throughout the world of NATO, across politics, markets, currencies, and welfare systems, the ruling logic was simple: compromise is not utopia, but it beats a revolution conducted through the procurement department.
Then the alliance’s communist rivals disappeared. First, the Eastern Bloc nations abandoned what they called “socialism” one by one. Then the Soviet Union dissolved itself in 1991.
In the absence of their ideological sparring partner, liberal capitalist elites gradually abandoned class compromise, the way you abandon gym memberships. In the beginning, you insist that you’ll return. Then you avoid eye contact. And eventually, economics goes on without you.
The collapse of the postwar compact was not poetic, redemptive, or surprising, but bureaucratic.
Trade agreements kept liberalising markets, capital kept globalising supply lines, finance kept financializing everything that could still put on pants in the morning, and growth slowed into the awkward lethargy of a system that believed dreams were historically someone else’s department.
Lower growth rates are now a reality, not a negotiating position, and elites offer citizens managerial theatre as if printing consensus pamphlets makes the economy behave.
Meanwhile, populists offer villains, explanations, scapegoats, invisible cabals, and cartoonish agency — a menu that includes everything except realistic capacity to do anything about the economy.
During his first presidential campaign, Donald Trump packaged dissent as a séance invocation for the industrial past. Make America Great Again was not an argument. It was a potion. Citizens drank it not for policy substrate but for agency placebo, a chance to narrate influence in a system that steadily stripped influence from anyone who was not currently an offshore bank address.
In his 2000 book Empire of Conspiracy, Timothy Melley termed this dynamic “agency panic.” People fear that they lack control over the systems large enough to matter and seek to identify someone — anyone — to blame for this sense of powerlessness. Populists exploit this panic beautifully.
Conspiracy theories flatter both resentment and the structural vacuum where agency once lived.
When people correctly sense that distant forces steer economic outcomes, their panic does not translate into a demand for structural reform but into structural fan fiction. Reason and moderation stop being persuasive virtues and start being adjectives you loudly assign to your actions while doing the opposite quietly.
During the Cold War years, technocrats could sell moderation with the pious conviction of people integrating societies rather than optimising them financially.
Today’s technocrats optimise politics the way budget airlines optimise legroom. They have a plan. It fits only a few. Yet they assure themselves that it integrates something. But this integration is confined mainly to the conceptual realm, while economics disintegrates materially.
Emmanuel Macron’s La République En Marche!, a movement founded in 2016, treated centrist politics like startup branding: new packaging, same fragile entrepot.
In the previous era, similar bureaucratic modernisers might have integrated politics enough to maintain class credibility. Macron flogged technocracy the way LinkedIn influencers flog productivity: heavy on impulse, light on structural weight.
In Hungary, Viktor Orbán turned nationalism into a governing cymbal crash. In Italy, Giorgia Meloni hawked national identity narratives like nostalgia souvenirs. In France, Marine Le Pen offered grievance populism as a national therapy plan.
In Argentina, Javier Milei sold libertarian economics with a conspiratorial flair, suggesting that policy accuracy was optional but resentment was required.
These “hucksters”—academics can fight among themselves over whether that’s generous or libelously polite—operate under the tacit premise that economics is not a problem to solve but a theatre prompt to distract from reality.
The politics of these reactionaries have succeeded, not because they produce stability, but because the centre-left parties they rail against stopped striving to increase participation—economic, institutional, social—for the lower half of the income ladder. As a consequence, authoritarian populists stopped offering a future that could actually be distributed and started offering a narratable villain instead.
Conspiracy is cheaper than class compromise and does not demand raising wages, taxing wealth, or lowering rents. It demands ratcheting up the tension.
Meanwhile, the moderate left worried that addressing inequality directly might alienate donors at the top of the income distribution. So they fiddled with tone, moderated culture, made speeches about dignity, worried about optics, and vigilantly protected elite self-regard from sounding unreasonably expensive. They spent another three decades learning what airline executives already knew: social democracy without redistribution eventually produces democracy without society.
The issue is not simply corruption or cynicism. The North Atlantic world is at a structural impasse.
Centre-left parties do not avoid redistributive politics because they lack polling data supporting economic reform. They dodge it because affluent donors prefer growth management without wealth management and inequality discipline that applies downward rather than upward.
Donors fear populist instability more than they fear economic stagnation, akin to fearing a broken handrail more than the systemic failure of the plane’s engines. So the centre-left protects capital from panic and protects donors from being asked to compromise with people who panic from a lack of compromise.
The bargain that once required a balancing of classes to prevent communists from winning ended when the competition ended.
Today, liberal democracies face a centrifugal system that runs colder, angrier, and slower. Populism offers agency placebo; technocracy offers stability placebo; growth offers nothing and gets away with it because citizens are too busy arguing over villains who are not actually steering anything other than the anxiety of voters.
Stability was previously sold through shared growth. Now it is sold through cultural moderation sermons and identity fireworks.
If this situation can be rescued—and no one should pretend that rescue is out of the question—it will demand a return to the only political programme that proved capable of stabilising democratic legitimacy in material ways. That would mean reviving the social democratic principle of redistributing wealth, while finding a way to limit the donor class’s stage fright.
The have-nots of these societies face problems that must be confronted directly.
Wealth needs redistribution, not as an oxbow lament but as actual fiscal policy. Governments need to tax wealth, moderate housing costs, support wages, invest robustly, and — above all — sell stability by making citizens believe that the system serves more than donors, institutions, and spreadsheets.
Saying this out loud used to sound ideologically radical. Today, it merely sounds logical.
Liberal democracies convinced themselves for decades that they should take the temperature of society’s future from the donor class. But their thermometer has been defective for many years.
Extremists have filled the vacuum with villains, conspiracies, and narratives that promote panic without helping the people in concrete economic ways.
That’s why, if centre-left parties actually want to govern, they will need to do something rather old-fashioned: sell policies that genuinely help working people economically, directly, and palpably, without waiting for someone else to do it first.
This will not be a glamorous undertaking. Compromises rarely are. But the alternative — conspiracy politics, nationalist fireworks, economic claptrap — will deliver neither growth nor stability. All the latter can do is decorate decline.
Social democracy once thrived on the principle that compromise politics, while nobody’s idea of utopia, were better for everyone than revolution.
Today, we are discovering that the reverse remains true: redistributing wealth and investing in citizens may be a far cry from utopia, but it is still better for liberals than watching ethnonationalists treat stagnation as performance art.
Photograph courtesy of Joel Schalit. All rights reserved.
