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Joseph MicallefDuring the 2016 United States presidential election, Democratic candidate Hillary Clinton famously described the supporters of the Republican candidate Donald Trump as “deplorables,” a group she dismissed as uneducated, misogynistic and racist.
While her comments were roundly condemned, there was one essential truth in her statement; Trump is garnering particularly strong support from less-educated, white males, many of whom work in industrial “blue collar” jobs.

Is it possible that the Republican Party, historically the standard bearer of Wall Street financiers and captains of industry, is becoming the party of the working class? The answer is a qualified yes.

This caps a long-term evolution that began a generation ago when southern blue collar workers, the so-called Nixon and Reagan democrats, crossed party lines and eventually switched their party affiliation.

Under Trump, this trend is showing signs of spreading north to the heavily unionized, industrial heartland of the U.S. In the process it is putting “into play” states like Michigan and Wisconsin, which have been historically, reliably Democratic in presidential elections. Regardless of the electoral outcome on Tuesday, this is an ongoing trend that heralds both a realignment of U.S. politics and a harbinger of change in the broader industrialized world.

Increasingly, in the western world two different economies will coexist, the manufacturing economy of tangible things and the digital economy of intangible products. Of late, employment in the intangible economy has been accelerating while employment in the tangible economy has been shrinking. That development is driving a long-term political realignment in the western world.

In the last two decades, North American manufacturing has lost more than six million jobs; about one-third of all manufacturing jobs. In that same period, the total economic value of manufacturing output increased by roughly 50 percent. Two-thirds as many workers produced 50 percent more than their fathers did.

Nor are these trends unheard of. A century ago, half of all workers were employed in the agricultural sector. Today, about one percent of workers work in agriculture, while output has increased more than twenty-fold.

Free trade, robust supply chains and new foreign hubs of low cost manufacturing have shifted these jobs overseas. Globalization, however, is not entirely at fault. Computer technology, inexpensive chips and ever more sophisticated software have driven factory automation and also reduced manufacturing jobs.

Since 2008, employment growth in the intangible economy has been growing faster than in the tangible one.
These economic trends manifest themselves politically in the divergence over key issues between the tangible and intangible economy.

For example, take energy and global warming. The manufacturing sector represents roughly one-third of North American energy consumption. Energy costs are typically one of the top three cost items in manufacturing. Such costs are less important to the intangible economy. Not surprisingly, voters in the intangible economy are more willing to replace inexpensive hydrocarbon energy with more expensive “green” energy than workers in the tangible economy.

Immigration shows a similar fault line. Workers in the tangible economy see increased immigration as a competitive threat to their employment and wage prospects. In the intangible economy, immigration is a source of highly skilled and educated workers and cutting edge knowledge.

The debate over globalization has a similar division. In the tangible economy, support for free trade is inversely related to an industry’s global competitiveness. The North American aerospace industry, for example, is cutting edge and strongly supports free trade. The steel industry, on the other hand, is often burdened by significant legacy costs and older technology and is far more protectionist.

The intangible economy, not surprisingly, is far more supportive of free trade and globalization. This is especially true in the digital sector, where global distribution can be achieved with a mouse click.

In the U.S., the Democratic Party has emerged as the defender of the political and economic interests of the intangible economy, while the Republican Party has emerged as the standard bearer of the tangible economy. That’s why Silicon Valley is a bastion of Democratic Party support and steel workers and coal miners increasingly vote Republican. It’s also why those states where the intangible economy is growing rapidly, like California, Washington, Massachusetts, North Carolina and Colorado, are increasingly Democratic or have shifted from reliably Republican to swing states.

Much the same trend is developing in Europe, where right wing parties have crafted a message that is anti-immigration, anti-globalist and anti-EU in their appeals to dissatisfied, less educated industrial workers.

For the Republican Party, this growing realignment is a mixed blessing. On the one hand, it may turn states with a large proportion of blue-collar workers, like Michigan and Wisconsin, reliably Republican, but at the risk of aligning the party with an economic sector whose overall economic role will continue to decline.

The tangible economy won’t disappear. You can’t eat bits and bytes, nor can you construct a house with them, but the overall economic importance of the tangible economy will continue to decline and the role of the intangible economy will continue to increase.

How today’s political parties adapts to those changes will shape politics for the next generation.

Joseph Micallef is a historian, best-selling author and commentator on world politics. 

Joseph is a Troy Media contributor. Why aren’t you?

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working class intangibles

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