Newsletter: After the EU shock – Learnings from the Berlin Summit - Interview Dani Rodrik, Recaps Bidenomics & Populism

From our Forum New Economy newsletter series




11. JUNE 2024



Dear friends and colleagues,

Just a few days ago, the possibility of right-wing nationalists coming to power in France – as is already the case in Italy and the Netherlands – seemed rather unlikely. Since Emmanuel Macron dissolved the National Assembly on Sunday evening as a result of the shift to the right in the European elections, this could happen in a few weeks’ time – after the upcoming snap elections at the end of June, beginning of July: in the country with which Germany has stronger economic and political ties than any other.

The AfD in Germany has also become significantly stronger – despite all attempts by those in power to prevent this through some kind of soft imitation. All of this makes it all the more urgent to look for the real causes of so much discontent – one of the main topics at the Berlin Summit two weeks ago. A guide to the highlights to re-watch and read.

It is clear that there are many reasons for this discontent. It now seems equally clear that populists always receive particularly high levels of support in regions where there have been major upheavals. The decisive factor is not the level of income, but whether people have the feeling that they are falling behind in comparison to the past or in comparison to others: relative downward mobility, as Teresa Ghilarducci calls it. Find the summary of the session with Eric Lonergan, Catherine Fieschi and David Dorn here.

So why isn’t what Joe Biden is currently trying to do – investing in regions that have experienced upheaval – working? Perhaps because inflation got in the way. Or because the investments cannot take effect quickly enough to restore people’s confidence. Populism researcher Robert Gold believes Biden’s attempts may still make a difference in one or two swing states before the elections in November – if discontent subsides at least a little. The summary of the discussions around the Bidenomics question is available here.

Dani Rodrik explained how industrial policy works in a short interview and Mariana Mazzucato shared a message on the declaration adopted at the summit.

Since the Berlin Summit, the Berlin Declaration has been making the rounds on how people can possibly be won back. Nobel Prize winner Angus Deaton has now also signed it – along with a few dozen other renowned experts. The text will soon also be published in French and German. Versions in Japanese, Italian and Dutch are already available.

All sessions to re-watch here.

What happens after the Berlin Summit – more on this shortly.

Have a good start to the week,

Thomas Fricke

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