The newsletter titled “White House Watch” is available for free, offering an insightful guide to understanding the implications of the 2024 US election on Washington and the global stage. Authored by the writer of the upcoming book, ‘Hayek’s Bastards: The Neoliberal Roots of the Populist Right’, the newsletter sheds light on how right-wing populist parties have traditionally utilized direct democracy to further their objectives. Historical examples include Switzerland’s minaret ban referendums and the Brexit vote, both of which aimed to bypass establishment figures and appeal directly to popular sentiment. In the United States, the Make America Great Again (MAGA) movement is exploring a novel approach: direct economics.
Direct economics, akin to plebiscites and referendums, seeks to circumvent experts and entrenched interests, connecting directly with citizens and voters. The strategy attempts to unveil processes historically obscured by stock market indices, interest rates, and fiat currency as mechanisms used by elites to continue their domination over the general populace.
Three examples illustrate direct economics in practice. Firstly, there is the centralization of executive power in former President Donald Trump’s tariff policies. While some criticize the seemingly arbitrary nature of these tariff announcements, proponents of direct economics argue that this unpredictability is, in fact, a strength. It demonstrates a significant shift in power, emphasizing the ability of the president to influence global markets and highlighting the transient nature of concepts like “most favored nation” status and multilateral agreements when faced with US authority.
The second manifestation of direct economics involves cash transfers initiated under Trump during the pandemic. The prominent display of Trump’s signature on the stimulus checks sent to Americans served as a direct, immediate form of state assistance, bypassing traditional channels like the Social Security Administration, Medicare, and other government services. This action was positioned as an example of public good delivered directly to private accounts.
Elon Musk, a significant donor to Trump and a fervent supporter of the MAGA movement, has adopted similar tactics in his efforts to sway elections, sporadically distributing oversized $1 million checks to supporters of his preferred candidates. Recently, Musk provided two such checks in Wisconsin for a candidate who ultimately did not win, which prompted an irate response from Musk regarding perceived judicial corruption. This raises questions about whether a voting system incorporating elements of a lottery could itself be considered a form of corruption.
The third, more obscure form of direct economics revolves around the precious metal gold. Though the US government prohibited private gold ownership until the 1970s following the seizure of private gold during Franklin D. Roosevelt’s presidency, a small faction of economic thinkers contends that the government continues to amass the metal. The belief is that such accumulation prevents citizens from independently withstanding an anticipated monetary collapse due to ongoing welfare spending and social policies.
A subplot of this belief suggests that the gold purportedly held by the US government does not exist. Critics claim that monetary value mediated through paper currency is an elaborate illusion destined for a disastrous collapse. Since the 1980s, former Republican Texas Senator Ron Paul has advocated for an audit of the gold reserves at Fort Knox, even introducing legislation in 2011 to that effect. This idea has gained traction with Musk, who has even suggested that Paul should be part of a so-called Department of Government Efficiency, raising questions about the veracity of gold reserves.
A precedent for such a movement exists. In 2012, a campaign in Germany led to the repatriation of a significant quantity of gold bars from the US to the Bundesbank, followed by their public display to assure German citizens of their existence. The leader of this initiative, Peter Boehringer, has subsequently represented the Alternative for Germany (AfD) in the Bundestag for two consecutive terms.
Direct economics presents a formidable challenge to existing institutions and intermediaries between the populace and leadership. Whether the strategies, tactics, and whims associated with direct economics can withstand their disruptive impact on traditional markets remains to be seen. In the interim, interest rates on US Treasury bills are declining, and consumer confidence is waning. Proponents of direct economics wager that these developments will ultimately prove inconsequential.
