How nationalism may undermine support for income redistribution

As a candidate, Donald Trump ran a strongly nationalist campaign with an undercurrent of populist economics. As president, he’s kept up the nationalism and ditched the economic populism. Did the nationalism make it easier to ditch the economic populism? Probably, yes.

To understand why, consider an article by Hebrew University of Jerusalem economist Moses Shayo with a compelling argument behind a clunky title: “A model of Social Identity with an Application to Political Economy: Nation, Class, and Redistribution.” The basic argument is this: High levels of nationalism undercut support for redistribution. In nations where national identity triumphs over class identity, the less well-off voters are less supportive of nationalism.

The more nationalistic the country, the worse the poor are doing relative to the rich

Shayo’s theory is that if lower-income individuals think of themselves as lower class, they will want more redistribution. If class consciousness prevails, the lower classes will strongly support redistribution and vote accordingly.

But if national identity is more salient than class identity, poorer individuals might instead identify with the nation more broadly, and less with their class.

Basically, humans are not selfish. We are group-ish. We want what’s best for people like us. But “people like us” is a highly subjective category. If “people like us” is “American patriots,” we’ll want what benefits “American patriots.” If we take on a nationalist identity, we can bask in the reflected glow of American greatness, even if our own finances are precarious. Thus, Shayo argues, “a national identity means less weight on class issues and less support for redistribution.”

Let’s start here by looking cross-nationally. In his article, Shayo plots data for 11 “established democracies” and compares the strength of nationalism (the x-axis) and the extent to which the bottom 20 percent of the income distribution has seen its income grow.

The basic takeaway is straightforward: The more nationalistic the country, the worse the poor are doing relative to the rich.

There’s also probably a feedback dynamic here. In more unequal countries, lower-class citizens tend to have lower status in society. Seeking improved status, they grasp for a grander identity. Nationalism is a grander identity. Or, as Shayo puts it, “Low redistribution tends to make identifying with the lower class less appealing and can encourage identification with the nation. “

This gives wealthy elites a powerful incentive to stoke nationalism — to, as Shayo puts it, “hype national threats in order to diffuse domestic claims for more redistribution.”

Make America great, make America unequal?

All of this seems eerily resonant with Trump’s whole Make America Great Again gestalt, which calls forth heightened nationalism alongside threats from terrorism and immigration, and then sneaks in generous tax cuts for the rich. Shayo notes that when citizens “identify with a given group, they want to be similar to typical members of that group: from wearing the group’s characteristic clothes and symbols to imitating typical group behavior and expressing typical group attitudes.” Think of all those MAGA hats.

Shayo’s theory is potentially useful because it explains why American greatness and inequality can coexist peacefully in the same party. The GOP has long been the party of nationalism and tax cuts for the 1 percent.

But there’s something else probably going on here too, what Shayo calls the “policy bundling effect” — that is, that in our current two-party system, any voters who want both strong nationalism and more redistribution are out of luck. No party offers that. So voters have to prioritize.

If redistribution is more important, these voters can choose to support the Democrats (though even Democrats are pretty limited by both historic and international standards in the amount of redistribution they call for). Or if nationalism is more important, they can choose Republicans.

But again, to the extent that nationalism undermines support for redistribution by putting national identity before class identity, Republicans have a strong incentive to make politics all about nationalism — at least to the extent they want to undermine support for redistribution.

Shayo makes a final (optimistic) point about group identity, which is that it can be malleable. Nationalism doesn’t need to undermine support for redistribution. National group identity could involve taking care of the less fortunate. But “[i]f it is an established practice in a given group to oppose redistribution, and if political behavior in that group is sufficiently salient, then agents who identify with that group will modify their own political behavior accordingly.” That is, if cutting taxes for corporations is a key tenet of nationalist Republican identity, group members will adjust their beliefs, rather than their identity.

One complicating factor here is the extent to which nationalism and ethnocentrism are connected. In their book Us Against Them: Ethnocentric Foundations of American Identity, Donald Kinder and Cindy Kam find that ethnocentrism has a “distinctive and independent” impact on public opinion — ethnocentric Americans tend to have less social trust and reject egalitarianism. They do not want to redistribute if they don’t think their group will benefit.

To the extent that Trumpist nationalism and white ethnocentrism are closely linked, it may be hard to disentangle them. Indeed, high levels of both predict the same outcome: less overall support for redistribution.

Does nationalism really make poorer Americans less redistributive?

How much does can Shayo’s nationalism-over-class-consciousness argument explain current American attitudes on redistribution?

Here, I turn to data from the Democracy Fund Voter Study Group. The 2016 survey, asked whether respondents wanted to “raise taxes on the wealthy.” Overall, 69 percent of Americans said, “Yes, raise taxes on the wealthy.”

Certainly, well-off Americans are less likely to support taxing the rich. But the gap between the wealthiest third of voters and the least wealthy third of voters (16 points) is not tremendous. Notably, a quarter of less well-off voters do not agree with raising taxes on the rich.

By contrast, 94 percent of Clinton voters wanted to raise taxes on the wealthy, while only 42 percent of Trump voters wanted to do so. Put another way, the gap between Clinton and Trump voters (52 points) was about three times as big as the gap between the richest third and the poorest third (18 points). Takeaway point: Partisanship matters more than income.

But nationalism does appear to matter. To see how, I construct a nationalism index based on agreement with three statements (“I would rather be a citizen of America than any other country in the world”; “There are some things about America today that make me feel ashamed of America” and “The world would be a better place if people from other countries were more like Americans”). The index goes from 0 (least nationalistic) to 1 (most nationalistic).

Overall, Clinton voters averaged 0.63 on the scale; Trump voters averaged 0.90. In short, Trump voters were more nationalistic than Clinton voters, but most Americans are bullish on American greatness. However, within both groups there’s some variation, enough that I could break respondents into three equal groups based on how nationalistic they are.

Now comes the interesting part. I also broke respondents into three roughly equal income categories, based on reported incomes. Now we can compare the percentage of voters within each income-nationalism-candidate subgroup and see what percentage support taxing the rich. Each dot is scaled to represent the frequency of placement in that subgroup.

Clinton voters overwhelmingly support taxing the rich, but it’s the most nationalistic Clinton voters who are least supportive of taxing the rich, especially among the poor. The 86 percent of highly nationalistic, low-income voters who support taxing the rich is lower than the overall 94 percent support among all Clinton voters.

Similarly, among Trump voters, the least support for taxing the rich also comes from the most nationalistic Trump supporters. Among lower-income Trump supporters, 50 percent of the most nationalistic support taxing the rich, compared to 62 percent of the least nationalistic. The gap is similarly wide in the middle-income category.

Also notably, among wealthy Clinton supporters there are very few strong nationalists, while among wealthy Trump supporters there are very few weak nationalists.

Bottom-line takeaway: Within each income group, but especially among the under-$40,000 respondents, the most nationalistic respondents were notably less supportive of taxing the rich, controlling for their vote. High nationalism appears to dampen support for redistribution. The differences are not tremendous (about a 10 to 12 percentage point gap in most categories).

Certainly, nationalism is not the only factor at work. But it does appear to matter. Wittingly or not, Trump’s yoking of nationalistic rhetoric and less redistribution fits a larger political pattern, one with potentially powerful psychological underpinnings.

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