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Explore the implications of the 2024 US elections for Washington and the world
The writer behind the soon-to-be-released book ‘Hayek’s Bastards: The Neoliberal Roots of the Populist Right’
For quite some time, right-wing populist groups have harnessed the power of direct democracy to further their agendas. From the Swiss ban on minarets via referendum to the Brexit vote, these movements aim to bypass traditional gatekeepers by appealing directly to the public’s desires. In the US, the MAGA movement is now trialing a new concept: direct economics.
Much like referenda, direct economics seeks to circumvent traditional authority figures and institutions, channeling its message directly to individual citizens and voters. This approach attempts to strip away the layers of complexity surrounding stock market indices, interest rates, and fiat currency, revealing them as tools used by elites to maintain control over the masses.
We can observe direct economics manifesting in three distinct ways. First, consider the concentration of executive power in President Donald Trump’s tariff strategies. His seemingly random announcements may be criticized by many, yet from a direct economics perspective, this unpredictability is seen as a source of strength.
When European markets anxiously await Trump’s daily cues, it underscores not weakness but dominance. It highlights how the abstract concepts of “most favored nation” treatment or multilateral sovereignty are merely shadows compared to US supremacy and the president’s power to influence global dynamics.
Another example of direct economics is seen in cash transfers, notably employed by Trump during the pandemic. The prominent signature on stimulus checks sent to Americans was a reminder that aid from the state didn’t have to trickle through outdated government systems like Social Security or Medicare. Instead, it was a direct benefit to individuals’ bank accounts.
Elon Musk, a prominent Trump supporter and fervent MAGA advocate, has embraced this direct approach. In his bid to sway elections, Musk has handed out oversized $1 million checks to those backing his chosen candidates. However, even his generosity hasn’t guaranteed success, as evident in a recent Wisconsin election where his candidate lost. Frustrated by this failure, Musk later criticized the judiciary, calling it the “long con of the left.” There’s room to ponder if treating ballots as lottery tickets is a corruption in itself.
The third expression of direct economics delves into the world of gold. Following the US government’s seizure of private gold in the 1930s and its prohibition until the 1970s, some economic thinkers have believed the government is hoarding gold to prevent citizens from being self-sufficient post a predicted monetary collapse due to welfare and social engineering efforts.
A subplot emerges with the belief that the US government’s gold reserves might be a myth. Paper money is seen as the ultimate deception, destined for a grim demise. Since the 1980s, Ron Paul, a former Republican senator from Texas, has been the leading advocate for auditing the US gold reserves, including legislation for an audit in 2011.
Musk has recently echoed these sentiments, proposing that Paul join his so-called Department of Government Efficiency. “Who exactly verifies the gold hasn’t been filched from Fort Knox?” Musk inquired on social media. The idea of a gold audit is gaining traction, backed by Paul’s son, Senator Rand Paul.
This isn’t without precedent. In 2012, a Munich-based precious metals consultant initiated a campaign in Germany which led to a significant repatriation of gold from the US to the Bundesbank, showcased for public assurance. The consultant, Peter Boehringer, now represents the Alternative for Germany (AfD) in the Bundestag.
Direct economics represents a formidable challenge to existing systems and those mediating the relationship between citizens and leaders. Whether these strategies will sustain their turbulent impacts on traditional markets remains to be seen in the coming weeks and months. So far, US Treasury bill interest rates are declining, and consumer confidence is wavering. The bet of direct economics hinges on the belief that these indicators may not hold as much weight.
