DEMOCRACY AND ECONOMIC STABILITY: HOW NEOLIBERALISM, GLOBALIZATION, AND RECESSION FUEL POLITICAL POLARIZATION AND POPULISM
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Recent public opinion data has revealed that satisfaction with democracy as a government system is in decline globally. An observed surge in support of anti-establishment movements is also recognized. The escalation of these groups has intensified partisan polarization and populism which decrease the effectiveness of democratic institutions and trust in government. Many scholars attribute this modern decline in democracy to a variety of social, political, economic, and contextual factors. The goal of this thesis is to join the conversation of why democracy is in decline by focusing on research from an economic perspective. The purpose of this research is to explore the relationship the economy has to democracy and provide evidence to support the proposed theory that economic stability is critical to democracy The methodology used to examine these topics includes a quantitative data analysis in a case study manner. The United States and Britain serve as countries for these case studies due to their dominance as democratic capitalistic nations. The research questions associated to this assessment investigate how recession influences political polarization, how party realignment alters public opinion, and how manufacturing production shifts impact populism. The data examined when answering these questions reveals decreases in reports of economic satisfaction, well-being, and confidence in government due to recession in chapter one. Chapter two’s discussion of realignment of the Labour Party in Britain indicates that public opinion of political satisfaction decreased while the importance relating to international partnerships and immigration increased among citizens. Chapter three found that economic insecurity caused by displacing local manufacturing jobs produces a nationalist political backlash. The findings of these chapters serve as evidence to support the claims that recession increases political polarization, realignment of the Labour Party in Britain decreased public opinion, and manufacturing production shifts increased populism. These conclusions indicate that current international integrative efforts have expanded the consequences of long-standing economic policies of previous decades which were then exacerbated by the Great Recession. The significance of this study is its use of these findings to illustrate how neoliberalism, globalization, and recession have destabilized economies. Modern political instability then evolved as a consequence to economic instability.