Why many workers now vote Republican

A striking feature of US politics nowadays is the flight of “workers” — meaning nonprofessionals, usually blue-collar or clerical — from the Democratic Party. For many decades after the New Deal, the Democrats were the party that championed unions, workplace safety and the minimum wage, while the Republicans were the champions of business.

Yet, according to Gallup, the proportion of Republicans who identify as “working class” or “lower class” has grown from 27 percent in 2002 to 46 percent today, while the share of working-class Democrats has fallen slightly (from 37 percent to 35 percent). Moreover, whereas 46 percent of white voters in union households supported the Democrats in 1968, that proportion had fallen to about 33 percent in 2020, a near-tie with Republicans. Since the 1990s, people in poorer, working-class locales have increasingly preferred Republicans to Democrats.

The usual explanation for this change is the rise of “neoliberalism” — the pro-market ideology that prevailed in policy circles from the 1980s to the early 2000s. Neoliberals promoted deregulation and globalization through support for free trade, unrestricted capital flows and maximal migration. Though Republicans pushed neoliberal policies harder than Democrats ever did, the Democrats eventually embraced them. Once the parties no longer differed much on economic policies, workers turned to Republicans who were more responsive to their religious and moral concerns; above all, their hostility to immigration.

Since the 1990s, people in poorer, working-class locales have increasingly preferred Republicans to Democrats

Eric Posner

Some blame Democratic leaders for relying too much on economists. But the dismal science was not the problem per se. A more accurate diagnosis is that neoliberal policies reflected certain peculiar assumptions made by a cohort of especially influential economists, even as other observers, even within economics, always recognized the flaws in their approach.

For example, one neoliberal assumption holds that labor markets are nearly always competitive. This view had far-reaching political implications because the costs of neoliberal policies like free trade are concentrated among workers in trade-exposed industries. Until recently, it was assumed that the costs for such workers should be minor. Unskilled workers would find new jobs at the same pay and, while more skilled workers might suffer some losses, they could put their skills to use in other industries or undergo training partly funded by the government.

Instead, recent research confirms what many non-economists would have called common sense: losing one’s job is financially and psychologically devastating. Labor markets, unlike most product markets, are local. People do not just pull up roots and go searching for jobs elsewhere; and jobs are much more important to people than goods or services. A plant closure in a small community may destroy that community, not just its employees’ livelihoods.

A related assumption is that policies should be adopted if they survive a cost-benefit test. But while cost-benefit analysis is an essential tool for policy evaluation, it provides poor guidance when used woodenly. Since the 1980s, policymakers at agencies like the Environmental Protection Agency have had to conduct a cost-benefit analysis whenever they issue regulations, and these calculations have almost always discounted the impact on jobs.

For example, a well-intentioned regulation that reduces pollution considers the health benefits for citizens and the compliance costs of the polluters, but not the effects on workers who will lose jobs because of the policy change. This omission, too, was likely based on the false assumption that labor markets are invariably competitive and that workers can always move from job to job at little cost.

The same assumption also led Democrats to downgrade their support for unions. In the old days, unions were widely regarded as champions of the working class. To the neoliberal mind, that was impossible. If labor markets are competitive, then wage premiums obtained by unions could only push up consumer prices and reduce economic output. Today, the value of unions is being reconsidered. When employers have market power, unions may provide the best means for enhancing workers’ well-being without sacrificing economic efficiency.

The costs of neoliberal policies like free trade are concentrated among workers in trade-exposed industries

Eric Posner

Economics has been badly tarnished by its starring role in neoliberalism’s ascent. The irony is that academic economics has never endorsed cost-benefit analysis, because there is no neutral or scientific basis to justify policies that benefit some people and harm others. The long search for a neutral criterion petered out in the 1970s, when economists finally realized that the criteria for evaluating policies rest on moral, rather than economic, premises. The peer-reviewed economics literature since then has rarely permitted normative arguments, as these would undermine the discipline’s scientific ambitions.

Nonetheless, economists typically (and often unthinkingly) rely on cost-benefit analysis when prescribing policies and, since the public and politicians do not distinguish between “academic” and “policy” debate, policy failures have diminished economists’ credibility more broadly. These developments also have fed the public’s skepticism of experts and technocrats of all stripes.

To be sure, through much of the neoliberal period, many prominent economists recognized labor markets’ rigidities and lack of competition. Yet only recently did they start to make headway against the assumption that labor markets are competitive. One suspects that the looming failures attributed to neoliberalism — rising inequality, the devastation of rural areas, political polarization, financial instability — finally provided a path for dissident views to reach policymakers.

There is a painful irony for Democrats who never intended to abandon workers and believed that neoliberal policies would help them by reducing prices and increasing economic growth. Now, even though Republicans have done far less for workers, working-class voters increasingly assume that the Democratic Party does not care about them and that it has become the party of elites — which is to say, just like the Republicans.

• Eric Posner, a professor at the University of Chicago Law School, is the author of “How Antitrust Failed Workers” (Oxford University Press, 2021).  ©Project Syndicate, 2024