Despair and the dying (literally) of the white middle class is all the news in America. A new paper by Angus Deaton (Nobel winner in 2015) and Anne Case shows that mortality among middle aged white Americans has been rising since 1999. Two fascinating articles by Paul Krugman and Ross Douthat in the NYTimes take opposing sides of this debate. Not that far apart  compared to the normal, considering that these gentlemen are on the opposite corners of the social liberal/economically Keynesian left-wing to religious conservative/Washington consensus right-wing spectrum.

The facts are known. What’s interesting are the distinct views on the facts, both well captured in a nuanced way by the columnists. The liberal side of the argument blames growing inequality and economic stress, pointing to Europe as a better solution where liberal economics has prevented this despair. The conservative side blames liberalism for the decline of social values that bind families together, pointing to Hispanics and blacks who are more religious, socially closer, have less wealth, but are not doing so badly in mortality.

Both columnists and the original paper, in distinct but nuanced ways, blame the existential challenge on the loss of a narrative for their lives. They use this to explain the rise of populist politicians who tap into the angst that such despair leads to.

I’d like to go beyond. I believe it is also the trajectory of despair-hope that drives this. Hispanics and African Americans may be at the bottom end of the wealth pyramid, but it is likely that their trajectory is generally upward. It is likely the reverse for the white middle aged American cohort.

As another randomised field trial in Kenya, based on a paper by Easterlin shows, “…. not inequality in general that bothered …. so much as a decline in their own wealth relative to the mean…” and “….However, the satisfaction of those who did not receive anything fell sharply as their neighbours’ fortunes improved. The decline in satisfaction prompted by seeing one’s peers get $100 richer was bigger than the increase of satisfaction from getting a handout of the same size….”.

The trajectory of hope counts when you deal with brittle human minds. If your wealth and economic situation is decreasing, when others are doing even just so-so, you despair more. If it is improving, even though you are worse off in absolute terms than others, you are more hopeful.

There may be a lesson for Singapore here. Is some of the resentment in the local Singaporean middle class similar to that faced by the American white middle class? Did the PAP sway the narrative sufficiently in the last five years and did that lead to their massive win? Which factor contributed to the swing: Listening more. Creating a massive narrative around LKY and SG 50 showing how far Singapore had come. Or addressing the trajectory of hope/despair by addressing both ends of the economic spectrum (handouts and subsidies for the locals, clamp down on the benefits to foreigners / richer people).

Europe too shows the validity of the trajectory argument. Germans are in the hope trajectory path (Volkswagen’s best efforts notwithstanding). Greeks are on a nowhere road to eternal despair. Many French, Englishmen and other Europeans who experience relative decline are more prone to populist ‘blame-the-other’ solutions. Those parts of these countries that are doing well stay true to their centrist liberal beliefs.

There is a lesson too for India and PM Modi. He won a massive mandate in 2014 when he tapped into the trajectory of despair of the average Indian by promising them “Vikas” and ‘Sab ke Saath”. He may have lost the plot in the last 18 months, by not delivering a real trajectory of hope, relative to his promise.

They say that American business is a lab test of great ideas that take over the world. Maybe this American lesson in the growth of despair is also a precursor of things to come for other parts of the world.

The only truths we know:
Despair kills. Relativity rules. Trajectory matters.

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