Forum newsletter: Beyond Right and Left – What Matters Is What Works / A Communist in New York?

Dear friends and colleagues,

what an uproar: Is New York now governed by a communist? A radical leftist? What Donald Trump denounces seems to trouble others as well. Yet the newly elected mayor, Zohran Mamdani, is calling for things like a rent freeze or a higher minimum wage – policies that conservative governments in Europe have already enacted. Looking more closely, one might wonder whether the old left–right labels are still useful when it comes to solving the major challenges of our time – rather than merely describing what Donald Trump or others think they are.

Must one be conspicuously left-wing to find it unsettling that Elon Musk may soon be worth a trillion U.S. dollars – and thus wield a kind of power that has little to do with relative human achievement? Even more conservative respondents say in surveys that this concentration of wealth is a problem. Does it take communist zeal to be frustrated with a world in which an absurdly high share of income goes straight to rent? Or to support a better-managed globalization – when China ruthlessly exploits the dependencies created by a poorly managed market globalization?

And conversely, does one have to be conservative or pro–free market to want to cut pointless bureaucracy? Of course not. Everyone can agree on that – for a recommendation to listen, check out our latest New Economy Short Cut with Patrick Bernau, Johanna Sieben, and Georg Diez – ​here​.

If that’s true, it also means that who stands the best chance of defeating Trump in the U.S. will depend less on whether a candidate is, by traditional political measures, moderate or (supposedly) radical – and more on who can offer people the most credible and effective solutions to those very problems. One can be moderate on some issues and radical on others. Trumpian bluster won’t help with that – nor will ordoliberal incantations, which are currently being so eagerly resurrected in Germany without any clear prospect of actually solving the underlying issues.

Alongside the Berlin Declaration of 2024, a new initiative has emerged, launched at the London School of Economics and now published as a book. Under the label “London Consensus”, leading thinkers such as Tim Besley and Andrés Velasco have compiled their answers – a nod to the Washington Consensus that once defined the era of market-liberal orthodoxy.

That solutions need not fit neatly into left or right boxes was also evident in Germany this year, when there was broad agreement on the major investment package and the necessary temporary deviation from the country’s overly rigid debt brake – even if its implementation is now fiercely debated.

On November 28, we’ll discuss all this at our Autumn Symposium in Berlin – with Steffen Meyer (State Secretary at the Finance Ministry), Green Party politician Lisa Paus, Mayor Christine Herntier, Council of Economic Experts member Achim Truger, IW Director Michael Hüther, Saarland’s Finance Minister Jakob von Weizsäcker, and others. Open to all. Register ​here​.

Have a great weekend,

Thomas Fricke

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