OR: What role do you see the financial crisis having played in driving the rise of populism?
Harper: I think it's the fundamental reason. In countries like the United States, you had a massive crisis with widespread negative social and economic impacts on people in tandem with bailouts for what were perceived as big and wealthy institutions (or even individuals). That's poison to political culture.
If you look truthfully at it, we could see all kinds of signs: the Tea Party, Occupy Wall Street. There are all kinds of signs that there was a lot of angst around this. I think as the recovery just continued to be slow and people could see, frankly, banks and the wealthier sides of society resuming their upward track and that things actually weren't improving for them, that just started to come to the fore.
As in the Republican primaries, I think the reality is you had a bunch of conventional Republican candidates who were announcing policies that didn't address the issues that actually concerned people anymore. The average working-class Republican voter who wasn't moving ahead wasn't really concerned about dropping high marginal rates in capital gains and corporate taxes. It just wasn't what was in their life. I think it was delayed but inevitable, in retrospect.
There are some pollsters who will dispute my analysis and say, "Well, in the data, economics looks secondary; it's really immigration and cultural issues that are driving it.” I don't believe that. I think that's the limitation, frankly, of polling.
I'm an economist and a politician. We know that when things are not good for people economically, suddenly a whole lot of other things make them mad that when things are good for them they really don't care about. I think to suggest that there is a widespread public angst or anger disconnected from people's economic circumstances is not consistent with what we know about human behavior in either economics or politics.
OR: How do you assess the major recession in leadership we seem to be facing?
Harper: I'm not trying to evaluate the President's personality or his policies. I'm certainly not trying to make predictions about the success of Donald Trump as President. I'm trying to draw attention to the fact that when we see things that have surprised people on the Left and the Right we should disabuse ourselves of the notion that this was all some fluke. As I say, the more I look at the themes and the more I look at governmental response, I see the public concerns as justified. The right thing for conservatives to do is to figure out how to adapt ourselves to this real public angst and these real public concerns with policies that will lead us in a positive direction.
For those conservatives who continue to have grave reservations about the Donald Trumps and the Nigel Farages, I say that the Donald Trumps and the Nigel Farages of the world are, for better or worse, attempting to fix what is wrong with democratic capitalist societies. If ultimately there is not some success through this, this task will eventually end up in the hands of the Bernie Sanderses and Jeremy Corbyns of the world — whose goal is to destroy democratic capitalist societies. It is a much bigger danger, a much bigger threat, and we are headed in that direction unless we adapt appropriately.
OR: How do you see the future of the postwar order in geopolitics and institutions like NATO?
Harper: I think the bigger threat to the West, long-term, would be something that would cause this current angst about market-based economic policy and trade policy, actually common to the left and the right wings of populism, to become ideological protectionism or, even worse, ideological socialism. That would destroy the West as an economic player, and would undermine our societies far more than geopolitical mistakes.
As regards NATO: this has been coming for a long time, far longer than the financial crisis. The reality of the Western alliance is that it has been increasingly based overwhelmingly on American contribution and moralizing from its partners, and that is not viable. I think the American public's sick of it. Why are we defending wealthy Europe when it doesn't appear interested in its own defense?
The American public — and I witnessed this up close — has been told two things that I think are contradictory. I saw it in my term in office; I continue to see it. It is told that America has a unique responsibility for global leadership and told, at the same time, that we're now in a multi-polar world where America can't really expect to lead.
So which is it?
Independent of what President Trump may or may not think, it’s not realistic for the world to expect the United States to act as a purely systemic player when it no longer has purely systemic power. It is logical that you would expect it to act more narrowly in its own national interests.
I expect to see an American policy that will become more focused towards its national interest. I expect it will recognize that for its own sake it has to engage in productive alliances, but that its partners will also realize that to expect situations where America contributes all of the resources and shares decision making is unrealistic. The Israelis have figured this out. If you want America to be a partner, you show how you can bring resources to the table, too. I think that can be adjusted. But we're at an impasse right now where it appears America is saying, "We're sick of supporting you guys. Just go away," and Europeans are saying, fingers wagging, "You're wrong; come back and serve us." That's not viable.
OR: Are you concerned about U.S. debt levels?
Harper: This is where as a more traditional conservative, especially in economics, I find myself out of step with American public opinion. It generally doesn't consider the debt a problem or the deficit a problem. That seems to be true on the Left and Right and in the center. At best, lip service is paid but hardly even that. I'm increasingly assured by Americans that because the dollar is a reserve currency there's no limit on the amount the government can borrow, and frankly the world seems to be willing at the moment to lend unlimited trillions of dollars to the United States at virtually zero percent. I think this is an unwise policy. I'm not sure it's having any impact yet, but it's bound to have an impact.