Friday6 September 2019 ★ FINANCIAL TIMES 9

Opinion

promised a campaign that might make

even Mr Trump blush.

Such has been the tumult since the

2016 referendum, it is easy to forget just

how far Britain has fallen. Trust in poli-

tics has collapsed. Civilised political dis-

course has made way for habitual ran-

cour. The essential norms and institu-

tions of democracy — tolerance, respect

for minority views, the impartial roles

of the judiciary and the civil service

among them — have faced sustained

attack. Casual falsehoods have become

a favoured ministerial currency.

A general election will not settle this.

Reason has fled from the European

argument. More than likely an election

will throw up another political dead-

lock. The minimum requirements for a

sustainable settlement are the removal

of Mr Johnson and another referendum.

At some point, of course, the EU27 may

lose all patience. It would be hard to

blame them. Mr Johnson once promised

to “take back control”. Now he has lost

control.

[email protected]

Mr Johnson’s claimed negotiating tac-

tic with the EU is redolent of playground

politics. He says Brussels will reopen the

arrangements agreed with Theresa

May’s government only if he convinces

them that he is ready to throw Britain

over the cliff-edge of a no-deal Brexit.

The message to Germany’s Angela

Merkel and France’s Emmanuel Macron

is simple: rewrite the agreement or we

will blow ourselves up. Madness.

The prime minister has read the dem-

agogue’s handbook: repeat the lie often

enough and a lot of people will believe it

— the more so when it is shot through

with dog-whistle xenophobia. During

the 1960s, America’s rightwing Republi-

cans embarked on what was called the

“southern strategy” — a populist pitch

to white working class voters who were

disenchanted with the civil rights liber-

alism of the Democratic party.

Mr Johnson has a “northern strategy”.

By casting Brexit as a fight against

foreigners and immigration he hopes

to win an election by winning over anti-

European white working class voters

in traditionally Labour areas. We are

US President Donald Trump — the

prime minister wants to frame a general

election as a contest between parlia-

ment and “the people” he now claims to

champion. Anyone who thinks that

Britain should not be wrenched out of

Europe by October 31 is a collaborator.

And, yes, the Europeans are the enemy.

Mr Johnson’s prospectus is shot

through with contradictions and

absurdities. He styles himself a cham-

pion of the sovereignty of the West-

minster parliament. Yet he has spent

the past several weeks seeking to

muzzle that very same parliament.

Having failed in the endeavour, he now

claims a higher authority as the repre-

sentative of “the will of the people”.

This way lies the authoritarian assault

on the institutions of democracy.

decent wing of the party — could not

have been a stronger statement that this

was an act of spite the prime minister

will regret.

Among the roll of former ministers

sacked from the party were Kenneth

Clarke, one of the most distinguished

Tory politicians of the postwar era,

Nicholas Soames, the grandson of Win-

ston Churchill, and Philip Hammond,

who until two months ago served as the

chancellor. These are figures who have

long upheld the respectful and essen-

tially honest political discourse of which

Mr Johnson knows nothing.

he purge sent another message.T

Not so long ago Mr Johnson posed as a

liberal-minded One Nation Conser-

vative. Now he has thrown overboard

the broad church, middling conserva-

tism of Edmund Burke. In his anxiety to

outflank Nigel Farage’s Brexit party, Mr

Johnson will fight an election as leader

of the party of English nationalism.

Scotland has been all but jettisoned.

Ruth Davidson, who headed the Scot-

tish Tories, was one of the most effective

leaders in the British political firma-

ment. She cited the pressures of family

life as the main reason for her recent

resignation. It is no secret, however, that

she loathed the pinched rightwing pop-

ulism peddled by the prime minister.

Her departure foreshadows a collapse of

the Tory vote in Scotland. The longer Mr

Johnson is in No 10, the surer the bet

that Scotland will back independence.

In the style of demagogues and xeno-

phobes through the ages — and with

more than a nod to the populism of

I

deological fervour has turned to

raging fever.Brexit as upturnedh

British politics. The very fabric of

the nation’s democracy is at risk.

Scotland’s place in the union of the

United Kingdom has been put in ques-

tion.Boris Johnson ould not care. Thec

prime minister and his band of Brexit-

ers decreed that Britain must leave the

EU on October 31. Not a day later. All the

rest was trivial.

Thankfully, parliament has decided

otherwise. This week the vulgar swag-

ger of Mr Johnson’s short premiership

faced a first collision with reality. A pol-

itician accustomed to lying and cheating

his way out of tight spots wasroundly

defeated n the House of Commons.i

Parliament now looks set to disarm the

October deadline by blocking the path

to a no-deal Brexit. It has also taken out

of the prime minister’s hands the date

for an inevitable general election.

Mr Johnson’s response was true to

character. In the manner of the flailing

school bully who has failed to get his

way, Mr Johnson withdrew the party

whip from the21 centrist Conservatives

who had dared defy him. The resigna-

tion from the government of his brother

Jo Johnson — a politician from the

Brexit has read

the rites over

British Toryism

Johnson’s strategy is from

the demagogue’s handbook:

repeat the lie often enough

and people will believe it

M

illions of American stu-

dents are now embarking

on that modern rite of

passage: starting college.

But as they begin classes,

there is a chilling statistic that we all

should study. Since 2006, outstanding

student debt has quietly tripled to

$1.6tn— nearly $35,000 per borrower.

That makes it the biggest source of

non-mortgage consumer lending, rep-

resenting around 7 per cent of economic

output. It also makes the American gov-

ernment “the largest consumer lender

in the United States”, since most loans

have federal backing, as Caitlin Zaloom,

an anthropology professor, notes in a

compelling new book ndebtedI.

This is startling — and scary. Doubly

shocking is that this explosion has hith-

erto sparked little sensible policy debate

or action. Elizabeth Warren, a leading

candidate for Democratic presidential

nominee, recently made waves by

proposing a tiered system forcancelling

student debt, based on income. Bernie

Sanders, her rival, wants a more radical

blanket amnesty.

Those ideas sparked scorn from

Republicans and unease from moderate

Democrats. But there is a paucity of

alternative plans — this is alarming, not

just for American families but investors.

The debt creates a debilitating eco-

nomic drag by reducing consumption,

entrepreneurial activity and household

formation among millennials. “We have

been building a bigger bubble [with stu-

dent debt] than the real estate bubble,”

says Dan Rosensweig, chief executive of

Chegg, which provides student services.

He argues that “the impact is much big-

ger than most people realise”.

What explains the tardy policy

response? Prof Zaloom suggests that

voters, until recently, were reluctant to

scream about their pain because it is

taboo in America to reveal etails ofd

household finances — and college

attendance is a defining trait of middle

class identity. “Most parents and stu-

dents view their struggle... as a per-

sonal and private problem,” she writes.

Thelobbying powerof the education

finance business has also impeded

reform. In addition, student debt is a

slow-burn crisisthat rarely delivers

headline-grabbing events.

However, senators Warren and Sand-

ers have now thrown the issue into the

spotlight in a way that should force

other politicians to respond. Not least

because these two now enjoy high

popularity amongyounger voters,

partly because of their stance on debt.

In reality, their proposals for mass

debt forgiveness are unlikely to fly.

Another cultural trait of modern Amer-

ica is distaste for debt amnesties. Note

that Barack Obamadid not deliver debt

forgiveness or subprime debt, evenf

though the latter helped cause the 2008

crisis and hurt many poor voters.

However, there are other ideas being

tossed aroundthat should be adopted.

One is to develop occupational alterna-

tives to college. These are already

emerging: Mr Rosensweig points out

that some company executives areso

spooked by the mounting debt that they

are offering in-employment training.

This company training could be

supported by additional tax incentives.

More radically, groups like Chegg think

students should be allowed to count

more of their loan repayments against

income tax. (Right now, borrowers can

only deduct up to $2,500 of interest

each year.)

There is also a strong need, as

President Donald Trumphas acknowl-

edged, to make the student finance sys-

tem more transparent and simpler. And

there is a very strong case for slashing

the interest rate on loans.

This currently stands at 4 to 7 per cent

for federal loans, and close to 10 per cent

for private debt, which is outrageous

given current Treasury yields. My

favourite idea is one recently put

forward by Sheila Bair, former head of

the Federal Deposit Insurance Corpora-

tion: “income share agreements” in

which a lender funds education in

exchange for a small percentage of the

borrower’s future income. This would

reduce the strain on young workers.

Right now one-quarter of federal loans

fall into default. However, it would be

more fair han blanket debt forgiveness,t

given that college-educated workers

tend to have higher salaries.

Of course, a huge drawback is that

“income share agreements” are not as

eye-catching as a blanket amnesty. But

it could probably win widespread

support, even on Wall Street. Many

financiers are becoming seriously

concerned that the student loan prob-

lem is creating economic drag and

fuelling anti-establishment politics.

Either way, ignoring the issue now

looks as untenable as a student ignoring

homework. America’s grown-up politi-

cians should take note.

[email protected]

The education loan

problem is creating

economic drag and fuelling

anti-establishment politics

America’s debt-laden students require better policy solutions

FINANCE

Gillian

Tett

M

illions of hectares of for-

estare burning, as we

watch powerlessly. Sibe-

rian wildfires prompted

Russia to declare a state

of emergency in July, and now the Ama-

zonian rainforest is ablaze. Brazil’s man-

agement of the fires has stirred global

outrage. But is looking for scapegoats

really all that we can do?

The fate of the planet should not rest

solely on Brazil’s shoulders. While the

Amazon rainforest makes up roughly

40 per cent of Brazil’s territory, the

country does not draw much economic

advantage from it. President Jair Bol-

sonaro has drawn criticism for wanting

to exploit the Amazon, but asking him

to spare the rainforest at all costs, for all

time, is just as unfair. Few expect Saudi

Arabia to stop drilling for and exporting

its oil reserves in the name of cutting

carbon emissions.

A fairer approach would be to con-

sider Brazil’s development goals and

compensate the country for the eco-

nomic losses associated with not

exploiting the Amazon. Our best chance

to save these forests is to make them

more valuable to their host countries

intact than they would be as agricultural

land or mining sites.

Experience in China, India and south-

east Asia shows that developing coun-

tries are rarely willing to give up growth

opportunities to prevent environmental

damage. By the time many countries

begin to focus on environmentally

friendly policies, thousands of species

may be extinct, as ecosystems suffer

permanent damage. Rather than wait

for political change, we should use

financial incentives.

The world’s developed economies

could provide temporary financial sup-

port to developing countries that host

rainforests, helping them to grow their

economy without resorting to forest

exploitation. By my calculations, the

sacrifice would be small, as little as half

a per cent of gross domestic product.

For the Amazon, we shouldconsider

an annual compensation scheme that

would reward Brazil for guaranteeing

that not a single more acre of the rain-

forest will be converted to agriculture.

Negotiations may be tough: Mr Bol-

sonaro initially refused the G7’s $22m

aid offer alleging that the group was

treating Brazil as a“colony”. In future,

such compensation should be granted

without strings attached beyond guar-

antees that the rainforest will be pre-

served and foreign aid will be accepted

to fight future ecological disasters.

Just as Unesco was created to protect

the cultural heritage of humanity, it is

time to enable an international body to

take steps necessary to protect those

forests considered vital for the planet.

Reaching an agreement on how much to

pay and which countries are eligible will

be difficult,but the sooner we design an

efficient mechanism to preserve our

rainforests, the better. We can no longer

afford to sacrifice our environment for

economic interests; repairing environ-

mental damage will cost us considerably

more than taking preventive measures

For this to work, we must make sure

that countries whose territory is largely

covered in rainforests do not suffer eco-

nomic disadvantages from not exploit-

ing these lands. Brazil’s dilemma is

instructive. It is one of the main export-

ers of soyabeans to China. The China-US

trade war gives it an incentive to trans-

form forested areas into new agricul-

tural lands to increase soy production.

Granting Brazil compensation for pre-

serving the Amazon could help reorient

its investment to other sectors.

Forests worldwide, and rainforests in

particular, play a crucial role in stabilis-

ing our climate by preventing desertifi-

cation and landslides and storing excess

carbon dioxide, while accommodating

about 80 per cent of the world’s terres-

trial biodiversity. They are one of the

most valuable natural assets that we

have and it is imperative that we protect

them. If our ambitious pursuits destroy

nature, there will be no one left to tell

our story.

The writer is a fellow at the Romanian Insti-

tute for the Study of the Asia-Pacific

Brazil needs

compensation

to protect the

Amazon

Andreea

Leonte

Our best chance to save

these forests is to make

them most valuable to their

host countries while intact

I

taly’s new coalition government,

composed of the Five Star Move-

ment and the Democratic party,

has been praised internationally

in a plethora of unlikely lauditsp

fromJean-Claude Juncker, the outgoing

European Commission president, and

US PresidentDonald Trumpto the

Vatican.

This alliance of former sworn enemies

cannot be explained simply as an effort

to keep Matteo Salvini’s far-right

nationalist Leagueout of power. Rather,

Italy’s new political experiment also

represents a synthesis of the two main

forces that have defined European pol-

itics over the past decade: populism and

technocracy.

The Five Star Movement is a quint-

essentially populist party. It first rose

to prominence through its founder

and charismatic leader Beppe Grillo’s

vehement denunciations of political

elites (la casta)and remains committed

to a bottom-up form of direct democ-

racy, which sidelines the role of parlia-

ment and intermediary institutions. Yet

the party iscalling for a “responsible

government” to avoid a confrontation

with the EU over the upcoming budget.

Mr Grillo even suggested that the gov-

erning team should be made up of inde-

pendent “technicians”, though in the

end only a few key ministries were not

assigned to explicitly partisan officials.

The PD has historically been the party

of institutional propriety and stability. It

sided with the country’s judicial system

in its struggle against former prime

minister Silvio Berlusconi and was one

of the main supporters of Mario Monti’s

technocratic government after the 2011

economic crisis. Yet, it is now calling for

a “radical turn” in the way the country is

run and has proposed the new executive

be labelled the “government of novelty”.

What is taking shape in Italy is a para-

doxical cross-breed of populism and

technocracy — or techno-populism. It

marries an anti-establishment appeal

and calls for radical political change

with claims to institutional responsib-

ility and fiscal competence, designed

to reassure international partners and

global investors. What holds them

together is what they both stand against.

Far from being at odds with one

another, populism and technocracy are

actually two sides of the same coin. As

political scientist Jan-Werner Müller

haspointed out, “populism holds that

there is only one authentic will of the

people”, whereas “technocracy holds

that there is only one correct policy

solution”. They therefore share a deeply

anti-political strain: each claims to pos-

sess some kind of “truth” which makes

parliamentary politics redundant and

leads them to see opponents as enemies.

It is no coincidence that both Mr

Grillo and former PD prime minister,

Matteo Renzi have described Mr Salvini

as a “barbarian”. Yet Five Star is just

coming out of a coalition with the

League, and Mr Renzi’s government

once relied on votes from the centre-

right to keep the “dangerous” Five Star

Movement out of power.

In a system in which populism and

technocracy are the only options on

offer, every government is bound to

present itself as a way of staving off

catastrophe, since the opposite of the

“one authentic will of the people” or the

“one correct policy solution” must be

either political error or malice.

Mr Salvini participates in the same

logic, alternating between claims to

represent what “true Italians” really

want and to offer responsible govern-

ment in the name of “common sense”.

This explains the virulent rhetoric he

has already begun to deploy against his

former coalition partners — which may

well benefit him at the next electoral

round, especially if the country goes

into a recession. He remains on the

populist spectrum.

In truth, techno-populism cannot

really serve as an antidote for

nationalist populism. To the extent that

populism and technocracy are able to

go hand-in-hand, more of one does not

necessarily imply less of the other.

Rather, the two prove to be mutually

reinforcing, since they share the same

underlying conception of what politics

is about and how to deal with political

opponents.

If either is seen as a problem, they can

only really be overcome together. This

requires reviving what they both implic-

itly stand against. That is, the tradi-

tional view of multi-party democracy as

“regulated rivalry” among legitimate

political projects, each representing

different interests and values within

society. Coalitions are of groups with

shared interests rather than emergency

moves to keep the barbarians out.

What Italy needs right now is more

old-school parliamentary politics,

focused on extracting a positive political

project out of competing ideological

platforms, rather than the anti-politics

of techno-populism.

The writer is an associate professor of polit-

ical science at City University of New York

The government taking

shape marries insurgent

appeal with institutional

responsibility

Italy’s new experiment in populist technocracy

Carlo

Invernizzi Accetti

POLITICS

Philip

Stephens

SEPTEMBER 6 2019 Section:Features Time: 9/20195/ - 18:21 User:dana.prince Page Name:COMMENT USA, Part,Page,Edition:USA , 9, 1